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Article posted Nov 05 2012, 5:40 AM Category: Economy Source: James E. Miller Print

Brad Delong and Happiness Fallacies

by James E. Miller

In a new article for the San Francisco Chronicle, Berkley economist Brad Delong bemoans over the state of income equality in the U.S. economy.  In typical leftist fashion, he complains that wealth disparity in the U.S. hasn't been as high as it is today since the Gilded Age (1870-1929).  The large gap between the haves and have nots has created an economy where less people are "happy."

To prove his theory, Delong argues the following:
A more equal economy would be a happier economy. The time and energy and work devoted to making, toasting and serving a $40 bagel at the Four Seasons Hotel on 57th Street in Manhattan would, in a more equal America, buy a full dinner for four at Sizzler Steakhouse for a family to whom going to Sizzler is a once-a-month treat – and thereby produce more human happiness.
To the unlearned, such reasoning may seem plausible.  In Delong's scenario, four people are enjoying an expenditure of $40 versus one.  If that $40 is spent satisfying four people as opposed to one, therefore more happiness is created.  But such a naïve assertion totally misunderstands the nature of human emotion and derived utility.

Happiness is not measurable in any cardinal sense.  Directly comparing satisfaction between two distinct individuals in any numerical way lacks any concrete meaning. It sounds downright asinine for someone to claim to be happy by "15" or "23."  If Jason ranks the happiness he gets from watching an episode of Seinfeld at a 6 on a scale of 1 to 10, there would be no meaning for him to say he twice as happy as Christine who happened to mark down 3.  Comparing the utility one family gets from a meal out to that of a rich capitalist enjoying a $40 bagel is, to put bluntly, a lame attempt to justify a statist scheme of redistribution.

Preferences can only be ranked ordinal and deduced through the observance of action.  As Murray Rothbard explains:
The concept of demonstrated preference is simply this: that actual choice reveals, or demonstrates, a man’s preferences; that is, that his preferences are deducible from what he has chosen in action. Thus, if a man chooses to spend an hour at a concert rather than a movie, we deduce that the former was preferred, or ranked higher on his value scale. … This concept of preference, rooted in real choices, forms the keystone of the logical structure of economic analysis, and particularly of utility and welfare analysis.
Happiness is at all times subjective and determined by the individual only.  The only social arrangement that allows man to pursue and fulfill his ends is free market capitalism.  Anything else provides a gateway for coercion to be introduced and the desires of the political class to take precedent over private individuals who refrain from using force.  A free society where the right of self-ownership is respected offers the most opportunity for men to achieve the ends they seek.  There is no alternative to achieve the same results.  To achieve the kind of happiness Delong believes everyone inherently desires, it would take a grand reallocation of wealth facilitated by the state.  In other words, it would be happiness through oppression.

As F.A. Hayek wrote,
A claim for equality of material position can be met only by a government with totalitarian powers.

Equality of the general rules of law and conduct, however, is the only kind of equality conducive to liberty and the only equality which we can secure without destroying liberty. Not only has liberty nothing to do with any other sort of equality, but it is even bound to produce inequality in many respects. This is the necessary result and part of the justification of individual liberty: If the result of individual liberty did not demonstrate that some manners of living are more successful than others, much of the case for it would vanish.
Delong's whole premise relies on the notion that a more equal society is a state of affairs wanted by all.  It appeals to infantile notions over what is fair and not fair.  To come off as compassionate about the plight of the poor, Delong argues that the more well off should be given no choice but to support the rest.  But equality is not at all something to be strived for.

By nature, human beings are unequal.  To advocate for one group of people to use the authority of badges and guns to take from some and give to others does not create equality; it is an explicit granting of a privilege to a very few to initiate violence on the greater public without facing rebuke.  Statism, in whatever form, is inherently unequal.

Even in terms of income, that which is earned through theft and that which is earned by voluntary payment are not equal.  One was obtained through meeting someone's demands, the other through violence.

It is often of great amusement to this writer to ask followers of Delong's philosophy of cramming happiness down our throats through state authority why government must resort to such methods as taxation.  If politicians and bureaucrats are only armed with the best intentions, why the need for force?  Shouldn't the benevolence of state action not require any coercion?  As Frank Chodorov trenchantly puts it, "If the State serves a good purpose the producers will hardly object to paying its keep."

The fact of the matter is the state operates through compulsion because that is the only way its operators are able to enforce their will.  Unlike private, voluntary transactions that are reciprocal, the use of force necessarily means that one party is losing out at the expense of another.  How happiness can be derived from denying the right of self-ownership is never answered by supporters of the state-enforced egalitarianism.

Delong paints a more equal society as just when it is nothing of the sort.  Tyrannical control is the only way to see to it that resources are distributed more equitably.  The fact that the popular Berkley economist rejoices in the happiness that comes from the steel-toed boot of the state reveals a great deal about him.
_
James E. Miller holds a BS in public administration with a minor in business from Shippensburg University, PA. He is the Editor in Chief at the Ludwig von Mises Institute of Canada and a current contributor to his hometown newspaper, the Middletown Press and Journal. He currently works in Washington D.C. as a copywriter.





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