Tuesday, November 11, 2008

Conservatives and Charity

Democrats are making an effort to peel off evangelical Christians from the Republican base by stressing their commitment to "social justice." Conservatives are not very good at talking about the poor and are often assumed to be greedy and uncaring.

To start, social justice, as promoted by the left, is based on the false premise that inequality is evidence of injustice. Inequality is portrayed as a societal problem to be remedied by government. However, I think most people would agree that people choose different paths in life and some acquire skills that are more useful to society than others. The fact that a brain surgeon, who after years of training makes more money than a fast food worker should surprise and upset no one. The chance to make more money than the fast food worker probably played a part in the surgeon's desire to complete the necessary training. People have a right to life, liberty, the pursuit of happiness and equal protection under the law. People do not have a right to economic equality.

Although the poor are not, as a rule, being denied justice, that does not mean we are free of responsibility to help them. Liberals have labeled conservatives as greedy and uncaring because we oppose income redistribution, however, Arthur C. Brooks' research in his book Who Really Cares shows that label to be the furthest thing from the truth. Brooks found that in the U.S., conservatives actually give more of their money to charity than liberals.

Brooks defined "liberals" as the 30% of the population calling themselves "liberal" or "very liberal" and conservatives as the 40% of the population calling themselves "conservative" or "very conservative." He was surprised to find that in 2000, conservative households gave 30% more than liberal households, even though liberal households earned 6% more on average. 24 out of 25 of the most giving states (charitable gifts/adjusted gross income) went for Bush in the 2000 election.

Brooks saw an even bigger difference when people were asked whether "the government has a responsibility to reduce income inequality." This is the crux of the argument between fiscal conservatism and liberalism. The 43% who disagreed with the statement gave 12 times as much as those who agreed strongly. The difference also carried over into volunteer hours and blood donation.

Many (certainly not all) liberals substitute political opinions for private giving while conservatives are more likely to actually give and volunteer. Favoring tax policies that "donate" other people's money is not charity and opposing them is not greed.

So conservatives do care about the poor. Why do we oppose income redistribution? It takes away economic freedom and stifles opportunity. Punitive tax policies reduce incentives to be productive. Less production means less opportunity. As Ronald Reagan once said: "I believe the best social program is a job." Private charities are much more efficient than government. Thoughtful givers can focus their gifts on efforts that help lift people out of poverty while government programs tend to keep poor people dependent and, well, poor. What's more, Brooks' research shows that these programs depress charitable giving.

I fear that President-elect Obama's policies will not help the poor. Instead his policies are likely to make them more dependent on government and reduce their opportunities to help themselves. I believe conservative policies are better for everyone, we just need to get better at explaining them.


Kyle Hommes said...

First of all, I would like to say that this is a great post on a very interesting topic. I don't think that there are any easy answers when it comes to working with poverty, and I agree with a lot of what you said. One thing that I do not completely agree with is the statement that private organizations are more efficient than government organizations. Some indeed are, but some are not. I have worked or volunteered in non-profits for about 7 years now and my experience hasn't been that npo's are always preferable. For one, there is typically not a lot of oversight in non-profits. Yes, that keeps the cost down, but it also lowers the quality of care that is given. The organization I work with now gives piss poor supervision, which in my opinion affects the quality of the therapeutic milieu. Because of this, kids stay in programs longer, go from program to program, and do not make much progress. Now, I'm not saying that government operations do a ton better, but I do believe that they have more oversight and can therefore provide better services at times. Also, many non-profits do not work separately from the government. Most either refer to government organizations, take referrals from, and/or get money from the government to work with their clients.

Secondly, many non-profits are very selective about the types of people that they help. In my experience they do not help the most messed up people. Those really needing help are passed off to government programs because non-profits do not want to get involved. Certainly there are exceptions, but in the mental health field, people with psychoses are not being helped at non-profits, they are are at state run mental institutions.

I'm not saying that the government is better at helping people than the private, npo, sector, but I definitely don't think they are worse. To me it doesn't matter whether the help comes from the government or the private sector, the help just has to be there. Want I want to see is an overhaul of our helping system in this country, because I do not think it works as well as it could or should. And, in my opinion, this is something that the government needs to take on. My worry is that the private sector is able to be choosey about the type of people they can help, but the government has a mandate to help everyone. For that reason, I think the government needs to make the necessary improvements to the helping system so that it helps more people and runs more smoothly.

Rudi said...

While I certainly can't speak for ALL private not-for profits, my experience shows them to be FAR more efficient than government-run organizations.

In the education field, it's not even close- the American public school system has disintegrated before our eyes, while private education (most private schools are not-for-profit) continues to be an outstanding investment. I'll throw public schools this bone- they HAVE to take everybody, while private schools can select students. BUT, the disparity between (tax) dollars spent at the public school and the results vs. the (private) dollars spent at private school and the results of each is amazing.

Jon Vander Plas said...

Kyle, I agree that sometimes the government can be more efficient. When and where the government is more efficient at providing necessary services I'm all ears. However, what about the basic difference in how conservatives and liberals see the poor? Does inequality result primarily from injustice or because of individual choices and genes? Do people have a right to some measure of equality necessitating government redistribution or do we each have an individual responsibility to help the poor?

To Rudi's point, not only are private schools better and more efficient they allow for greater economic fairness. How is it fair that I pay thousands every year in property taxes that pay for schools that my future kids will not attend? Why not privatize education and provide vouchers for low income kids to go wherever they want? I am encouraged to hear that some Democrats are risking the wrath of the teachers' unions and beginning to support vouchers at least.

Tom and Stacia said...

Hi Jon! I really liked this post. I don't have time to respond right now (getting the girls tomorrow -- grading like a maniac today), but I wanted to let you know I want to be a part of the conversation on this topic.

Kyle Hommes said...

Inequality results from injustice. Who chooses to be poor? And as far as genes go, look at Paris Hilton and Nicole Ritchie, they are stinking rich and dumb as rocks. I guess you could say genetics favored them in that they are physically attractive, but they are not really successful because of choices or intellectual ability or athletic talent (if that is what you mean by genetics).

As far as the second question I think that there is both collective and individual responsibility for taking care the poor. I don't think we need wealth redistribution, I just think we need good paying jobs with livable wages and some changes in the system so that there are equality opportunities for all people. I don't see that as government redistribution, though. I'm okay if the rich get richer, I just want the poor to get richer as well.

Jon Vander Plas said...

Certainly there are exceptions: Paris Hilton on the wealthy side and the disabled on the poor side. By genetics I meant we are not born with equal talents, but this is not injustice.

What about someone who drops out of high school and never attempts to acquire any sort of useful skill? Aren't they, in effect, choosing to be poor? Some parents don't instill good values in their kids - is that society's fault? Kids born into broken homes are at a disadvantage but are not, as a rule, victims of wrong doing by society. They are victims of their parents' choices. If you regard the able-bodied poor as victims of societal injustice then they are entitled to income redistribution as their right. I disagree with this idea. We should help the poor, but our help is charity, not what is due to them.

The problem, as I see it, is that your prescription for increased opportunity actually leads to less. A livable wage is code word for increasing the minimum wage - which as I've mentioned before, increases unemployment among low income workers and discourages workers from acquiring useful skills. As I posted earlier, the states with the most opportunity and highest wages are those with the freest markets.

Another question: Is Obama wrong when he says those opposed to his tax increases are greedy, selfish, and unneighborly? (I'll leave out Biden's "patriotic" comment).

Kyle Hommes said...

Show me the study that proves raising minimum wage leads to unemployment. Minimum wage hasn't been raise since Clinton, and unemployment is skyrocketing.

The repeal of Bush's tax cuts is not the same as raising taxes.

Jon Vander Plas said...

It's basic economics. Wages in a free market are determined by the demand for and supply of workers. If you artificially increase the wage, supply stays the same but demand will decrease (fewer jobs). Prices also go up due to higher wages, driving down demand for the goods and services being produced, further reducing employment. However, as economic growth creates more demand for workers, supply of workers stays the same and wages go up. The best way to increase wages is to grow the economy. We don't have such a high standard of living because of minimum wage laws.

Actually, the minimum wage was increased to $6.55/hr starting this past July and will go to $7.25/hr next July. The minimum wage has its biggest impact on unemployment among unskilled workers, but there are many more factors in play in overall employment.

I meant Obama's tax increases for the "rich", but allowing Bush's tax cuts to expire will result in a tax increase for almost everyone, while Obama promised that 95% of people would get a tax cut.

Kyle Hommes said...

So you don't think that if low-income workers made enough money working one job that they could quit their other jobs, allowing more low-income workers to take those jobs.

You can say that it is simple economics, but it can also be disproved by simple economics. Henry Ford chose to pay his workers more than GM and Chrysler, and was actually sued by Chrysler because they said he was paying them too much. His reasoning was that if He paid them more, they would be able to buy his cars, a theory that paid off for him.

You may disagree, but the rich benefit quite a bit from the way this country is set up, and I am okay with the rich paying more taxes to fund government programs, and it seemed that the rich were okay with it too because Obama won that voting bracket.

Our nation has been dominated by conservative ideals for the past 28 years, and look where it has gotten us. We are one of a handful of industrialized nations without universal health care, our economy is sinking, the income gap is rising, our infrastructure is falling apart, our schools are a mess, and we are spending a grip of money on a war that we can't win. I just don't by that line of thought on minimum wage, free markets, more privatization, or anything else on the economy that Conservative thought is putting out right now.

Jon Vander Plas said...

Everyone benefits from the economic growth that free markets encourage. The best economic growth is usually seen in markets that are unfettered by government. Look at the explosion of growth in China and India after they began to embrace the free market after centuries of government control. The average Joe in China and India is benefiting enormously from these opportunities.

We are the most productive nation in the history of the world. That is what free markets have done for us. We have continued to thrive despite government meddling and massive wealth redistribution, not because of it.

How does a firm's voluntary decision to raise wages (based on the idea that it would help their business) support your argument for forced increases in wages by government? That story supports my view more than yours.

Don't get me wrong, I don't have a problem with modestly progressive tax rates. My larger point is that government is poor at allocating resources. The free market is very efficient because people are better at spending their own money than the government.

Why on earth would we want the government to take over health care? Health care is 1/7 of our economy. What's wrong with the government only providing health care for the poor (as we already do with Medicaid, in addition to those on Medicare)? Why must everyone be in a government run plan? Because of the infinite demand for health care, it must be rationed. I DO NOT want the government deciding how to limit access to health care. With private plans, if I don't like my plan I can switch to another one.

The answer to rough economic times is not more government, more taxes, or more redistribution. More freedom, not less.

Kyle Hommes said...

The problem is that now the private sector is limiting health care. They tell me what procedures I can get or not get. What's the difference between a company doing that and the government doing that. I think the government would allow more than insurance companies would, I could be wrong, but that is my assumption.

I can't afford to just change insurance plans, and my wife has to be on a group plan. So, essentially, my health care choices are made by a company that sees me as a liability. If I actually have something wrong with me, I'm screwed.

As far as just giving health insurance to poor people, who decides who is poor. People just above the cut off line usually can't afford services, and what services they do get are nothing like want medicaid provides. That is part of the reason why so many people stay on welfare and medicaid because there is a huge gap between the benefits one gets when on it, and the services one can afford if they earn just above the cut off.

Our country could save so much money with universal health care, and I don't think the private insurance companies need to be shut down to do it. I think we should have a national health plan with the option of privatized plans that provide services through privatized health centers. That way if someone wants to opt out because they do not want the government in charge of their health care, or want additional coverage, they can buy into that system, and everyone is covered, which will lower health care cost.

Jon Vander Plas said...

If someone doesn't like his health care plan what he really means is that he isn't happy with his compensation. I think that if someone isn't happy with his compensation, ideally he should try to get a raise or switch jobs. This is preferable to using government to force your neighbor to give you more of his money.

The only way a government takeover could lower the amount spent on health care is by restricting care drastically. Government is guaranteed to be less efficient than private companies. Covering everyone doesn't lower costs, it increases them dramatically.

I think we should cover the poor with Medicaid (as we currently do). However, if this is keeping people impoverished as you claim (quite plausible) then we should lower the income threshold, not increase it.

Anonymous said...

I would be interested to see statistics backing your claims that government control of health care leads to high costs. A look to the north should disprove your theory, where it is evident that the Canadian system has proven to be far more efficient in cost--roughly half of what it costs per person in the US--and is providing care for its overall population at a much higher rate. Certainly you can make the argument that quality of care is diminished for some--primarily the wealthy elite who now have to deal with wait times--but generally speaking, the majority of people are better off. Additionally, many of the problems associated with the Canadian system, could be remedied simply through an American universal health care program, as it is not the Canadian system that causes slow wait times, but a lack of professionals who cross the border for higher wages. Eliminating that would clear up a lot of misconceptions associated with the apparent slow wait times in Canada.

Jackson said...

John, that last comment was from me; I didn't realize I was in an anonymous state. I would think it would be annoying to receive comments from people without knowing who they are and whether it is worth it or not to respond. I enjoy your blog and wish I had more time to respond to the many important issues that you bring up, but school is keeping me busy.

Jon Vander Plas said...

Jackson, an excellent point. If government controls the expenditures for health care it will be the sole authority on how much is spent. It can reduce spending on health care by rationing care, as we see in Canada and other countries. The gov't could also cut the cost of food if it forced us all to eat pork and beans for every meal. However, this is not the issue that concerns us. We are interested in getting the best care for our money. A very complex issue, a lot of ins, a lot of outs (as the Dude would say), but I'll try to give a couple reasons for my opposition to socialized medicine.

-Paying for it requires higher taxes, taking money by force from those who have produced it and giving it to someone else.
-It takes away my freedom to choose a plan that's right for my family.
-The economics of health care require a give and take between quality and cost. The freer the market, the more the balance between quality and cost will reflect the wishes of the people that pay those costs and receive the health care. In contrast, the choices made by elected officials and bureaucrats might only reflect the preference of 51% of the population. We are not currently in a very free market as the govt pays for 44% of all health care in the US.
-I am not content with health care as it is. I want it to improve. Financial incentives are important in developing new treatments and providing better care. Reducing the incentives through government may reduce quality more than the people (market) wish. You cite Canadian physicians going to the US to practice medicine. Isn't it likely that fewer and fewer talented people will choose to go into medicine if it was socialized? Lack of physicians is a problem caused by the socialized system. It's a classic example of price control causing shortages.
-My basic point: the government can't possibly spend our health care dollars as efficiently as we would. They can lower costs, as you say, but they can't maximize what we get for our costs.

We need more individual liberty, not less. Owning your own health care would lead to efficient health care utilization, encourage people to live healthier lives, and increase competition among health care providers. Socialized medicine does the opposite and should only be used for the poor.