George Stigler explains John Rawls’ veil of ignorance


Deirdre McCloskey summarises Rawls and Nozick on unequal incomes


Source: Review of Michael J. Sandel’s What Money Can’t Buy: The Moral Limit of Markets by Deirdre McCloskey August 1, 2012. Shorter version published in the Claremont Review of Books XII(4), Fall 2012 via Deirdre McCloskey: editorials.

On choosing the Bourgeois Deal behind the veil of ignorance


Source: Deirdre McCloskey: editorials: Review of Michael J. Sandel’s What Money Can’t Buy:  The Moral Limit of Markets , New York: Ferrar, Straus and Giroux, 2012. Pp. 244 +viii. Index. by Deirdre McCloskey  August 1, 2012. Shorter version published in the Claremont Review of Books XII(4), Fall 2012

John Rawls & The Principles of Justice

Richard Epstein on John Rawls as a classical liberal


Gordon Tullock on avoiding difficult decisions about saving lives – updated

Gordon Tullock wrote a 1979 New York Law Review book about avoiding difficult choices. His review was of a book by Guido Calabresi and Philip Bobbitt called Tragic Choices which was about the rationing: the allocation of kidney dialysis machines (a “good”), military service in wartime (a “bad”), and entitlements to have children (a mixed blessing).

Front Cover

Tullock argued that we make a decision about how to allocate resources, how to distribute the resources, and then how to think about the previous two choices. People do not want to face up to the fact resources are scarce and they face limits on their powers.

To reduce the personal distress of making these tragic choices, Tullock observed that people often allocate and distribute resources in a different way so as to better conceal from themselves the unhappy choices they had to make even if this means the recipients of these choices are worse off and more lives are lost than if more open and honest choices were made up about there only being so much that can be done.

The Left over Left and union movement spends a lot of time pontificating about how we must not let economics influence health and safety policy rather than help frame public policy guidance on what must be done because scarcity of resources requires the valuation of life in everything from health, safety, and environmental regulations to road building. health budgeting is full of tragic choices about how much is spend to save so lives and where and for how long.

The Left over Left and the union movement deceive themselves and others into make futile gestures to make themselves feel good. These dilettantes cannot assume that they are safely behind a veil of insignificance. They have real influence on how public policy on health and safety are made.

A major driver of the opposition among the Left over Left and the union movement to the use of cost-benefit analysis and the valuation of statistical lives is its adoption makes people confront the tragic consequence of any of the choices available to them.

By saying how dare you value a statistical life does not change the fact that choices made without this knowledge will still have tragic consequences, and more lives may be lost because people want to conceal from themselves the difficult choices that they are making about others as voters and as policy-makers.

One of the purposes of John Rawls’ veil of ignorance and Buchanan and Tullock’s veil of uncertainty is that the basic social institutions be designed and agreed when we have abstracted from the grubby particulars of our own self-interest.   Buchanan and Tullock explain the thought experiment this way

Agreement seems more likely on general rules for collective choice than on the later choices to be made within the confines of certain agreed-upon rules. …

Essential to the analysis is the presumption that the individual is uncertain as to what his own precise role will be in any one of the whole chain of later collective choices that will actually have to be made.

For this reason he is considered not to have a particular and distinguishable interest separate and apart from his fellows.

This is not to suggest that he will act contrary to own interest; but the individual will not find it advantageous to vote for rules that may promote sectional, class, or group interests because, by supposition, he is unable to predict the role that he will be playing in the actual collective decision-making process at any particular time in the future.

He cannot predict with any degree of certainty whether he is more likely to be in a winning or a losing coalition on any specific issue. Therefore, he will assume that occasionally he will be in one group and occasionally in the other.

His own self-interest will lead him to choose rules that will maximize the utility of an individual in a series of collective decisions with his own preferences on the separate issues being more or less randomly distributed.

Behind the veil of ignorance and the veil of uncertainty, we would all agree that resources are limited, including in the health sector and some drugs can’t be funded – choices must be made.

Once we go in front of the veil of ignorance and find out that we are the one missing out on that drug, naturally, our views will change.  We agreed to these rules  as fair for the distribution of basic social resources when, as John Rawls put it:

…no one knows his place in society, his class position or social status; nor does he know his fortune in the distribution of natural assets and abilities, his intelligence and strength, and the like.

Is always the case that someone just falls on the other side of any line in the sand. If you move that line, there is always another set of people who are just on the other side.

Walter Williams – what to do behind John Rawls’ veil of ignorance


James Buchanan and a non-discriminatory democracy?

James Buchanan was a classical liberal who admired the Swedish welfare state because it was based on the principle of generality.
Under Buchanan’s generality norm, governments impose uniform regulation and use flat rate taxes on uniform tax bases to fund an equal-per-head demogrant (or a guaranteed minimum income) to replace all existing government cash transfers. Such a government would account for a large share of GDP. That did not bother him:

It seems to me that far too much of our politics is favourable treatment or unfavourable treatment for particularised groups. If we could somehow introduce into politics the requirement that would be analogous to the rule of law, that is, don’t treat one group differently from another group.

That has a lot of implications. That would not necessarily mean we’d have much smaller politics or government. It would mean there’d be a quite different characteristic of government…

The normative thrust of my current work is to try to push the generalization principle to the maximum extent possible, that is, so you don’t have particularised exemptions. One person gets it, everybody gets it. It cuts in favour of something like a flat tax. It cuts against means testing.

Buchanan has said that all successful welfare states (such as Sweden) apply a generality norm in some form or another.

For Buchanan, the very logic of majority rule implies unequal treatment or discrimination. If left unconstrained, majority coalitions will promote the interests of their own members at the expense of others.

Buchanan proposed a non-discriminatory democracy through the principle of generality:

  1. If extended to any single industry, tariff or quota protection also be extended and on equal terms to all industries.
  2. Tax structures would necessarily become simple, since the same tax rate would have to apply across-the-board on all sources or uses of tax base. Flat rate or proportional taxes on all incomes would broadly meet the generality norm.
  3. On the transfer side of the budget account, payments would have to be made in demogrants, equally available to all persons.

This is equivalent to Rawls’ veil of ignorance: choices must be without knowing where you lie in society so you make choices that are to the benefit of all.

Buchanan argued that if politics generates undesirable results, it is better to examine the rules than to argue about different policies or to elect different representatives. He build on Hayek who called a constitutional amendment that should read:

Congress shall make no law authorizing government to take any discriminatory measures of coercion.

Hayek went on say that, with such an amendment, all of the other rights would be unnecessary. In a non-discriminatory democracy, government choices are limited to those that benefit all.

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