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Libertarianism Ain't What it Used to Be

Milton Friedman once famously remarked that "It’s just obvious you can’t have free immigration and a welfare state.”

And, speaking as somebody who still, doggedly, likes to think of himself as a libertarian, I think he was right. Once the taxpayer is shelling out thousands of dollars worth of benefits to poor immigrants, it's simply ridiculous to discuss the issue of immigration as if it were merely a matter of private contracts between employers and employees, in which the taxpayer has no legitimate interest.

Yet certain prominent libertarians, like Will Wilkinson, persist in doing just that. What's worse, they don't hesitate to tar as bigots those who dare to raise certain facts inconvenient to their position - without ever even attempting to refute those facts.

Shame on them.

Update below the line.

Mr. Wilkinson has has done me the honor of responding to one of my comments over at his place. He asks:

"Steve, Suppose

"(1) the average gain to taxpayers from immigrant labor more than compensates for immigrant-related welfare spending.

"Would you then be in favor of more immigrant labor?

"Suppose

"(2) it was possible to have a large guest worker program in which guest workers were explicitly ineligible for most forms of welfare.

"Would you then support the guest worker program"

I reply:

Mr. Wilkinson:

(1) The *average* gain to taxpayers, if any, is not dispositive, even if we are considering this in narrowly economic terms. It all depends on the distribution of gains and losses. If the majority of taxpayers lose, then why should they support more immigrant labor, just because relatively large gains to a minority of taxpayers (i.e., the immigrants themselves and their employers) make the average come out positive?

Consider a mini-welfare-state of a hundred citizens. One of them is a vegetable farmer. Two of them are farm-workers in his employ. The other ninety-seven buy vegetables at the store, but are otherwise unconcerned with agriculture. All of them pay taxes to support public highways, public schools, public health clinics, etc.

At this point, an immigrant family of four shows up on the doorstep. The parents are farmworkers, willing to work for half the wages of the current citizen farm-workers. They bring with them two school-aged children.

The farmer is delighted, and proposes that they be admitted.

Should the current citizens vote to admit, or to exclude?

If the immigrants are admitted, here are the obvious gainers: (a) the farmer, who can cut his labor costs in half and make a higher profit while at the same time reducing prices, and (b) the immigrants, who can make a far better wage than they could where they came from while at the same time enjoying the superior public highways, public schools, public health clinics, etc. of their adopted country.

And here are the obvious losers: the current citizen farm-workers, who must either accept a lower wage or move on to other employment (or unemployment).

As for the other ninety-seven, they gain from lower vegetable prices, but lose from higher public welfare costs.

Let's suppose, for purposes of argument, that the gains to the farmer, and to the immigrants, are so great that voting to admit results in an average gain to taxpayers (including the newly admitted immigrants). But let's also suppose, again for purposes of argument, that for the other ninety-seven, their gains from lower vegetable prices are smaller than their losses from higher public welfare costs.

In that case, I count ninety-nine rational votes against admission, and only one rational vote in favor, even though admission would result in an *average* gain to taxpayers.

So no.

(2) Possibly yes - but it's not possible, so...what?

Comments (25)

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If I may say so, that second linked post is weird stuff to be coming from a libertarian. Wilkinson, I mean. All this moaning and groaning about poverty. At least I take it he approves of it. It's in the quote he gives apparently approvingly. I mean, the way I always thought about the best libertarians, they didn't _agonize_ over poverty like that. Yes, they believed that the free market is a tide that makes all boats rise and all of that, and they would often point out--accurately enough--that many of the economic policies from the Left motivated by worries about "The Poor" would actually harm "The Poor." But I never thought libertarians were supposed to be saying to people, "Increase the poverty rate of your country, because that's a humanitarian thing to be doing, because you'll be helping The Poor (coming from the next country over)." Since when are The Poor the mascots for libertarians?

Mr. Wilkinson gets very riled up over immigration, and he has a habit of attributing the worst motives and attitudes to those who take a restrictionist or even an assimilationist view. As near as I can tell, he regards nation-states as entirely arbitrary and illegitimate and he thinks attempts to maintain borders between individuals who want to engage in some kind of exchange as fundamentally immoral. He objects to the Samuelson argument not so much because of a concern to alleviate the poverty of other people, but because he resents the presumption that the governments of sovereign nations have the right to say who can and cannot enter their territory. It is to his mind unwarranted state interference, and I'm afraid that pointing out costs incurred by the state and, thus, by taxpaying citizens as a consequence will leave him entirely unmoved. Presumably, he also resents confiscation and redistribution of property by the state, but I think anything infringing on the so-called "moral right of cooperation" is so terrible that it cannot be tolerated.

Let me clarify that last sentence: I think that Mr. Wilkinson believes that anything infringing on the so-called "moral right of cooperation" is so terrible that it cannot be tolerated. Obviously, I do not think this, since I don't acknowledge that such a "right to cooperate" exists.

So, the stuff about how we should be proud if our poverty rate goes up because that means we're helping the poor of other countries isn't really important to him? Actually, I think you might be right. It had a sort of overly clever ring, as though the outrage about the Mexican poor wasn't really what was important but was a sort of gloss on the top.

What I think someone like that doesn't realize is that the very conditions for free exchange--safety, enforcement of contracts, for example--depend on the existence of stable and not (too) corrupt government, which depends on defensible national sovereignty. Then, too, a libertarian wouldn't want the restrictions on his freedoms of expression and association found in other countries, but if national sovereignty disappears, how can he know that the freedoms of this sort that he enjoys as an American will continue?

Would not raising the minimum wage to $15/hr do more to take care of the illegal immigration problem and the externalities that flow from it than any other policy?

MZ, my own opinion is that that solution for illegal immigration is highly questionable. This came up on another thread. The theory, I gather, is that employers usually do put their illegals on the books (with phony SSN's, I guess) and do pay them at least the statutory minimum wage or even more, preferring them to American workers for various reasons. But, so goes the theory, if the minimum wage were hiked, the employers would ditch their illegals first in the ensuing layoffs, thus decreasing the incentives for illegals to come to the U.S. and shifting the available jobs to citizens. At virtually every step, this set of predictions seems to me questionable. For example, if the employers really prefer their illegals so _very_ much, and if they think they can continue to get away with employing them on the books as they've been doing all along, perhaps they would lay off the citizens instead and pay the illegals the inflated minimum wage. Or perhaps they would decide, especially with so drastic a hike as that, that keeping illegals on the books was not profitable anymore and would go to hiring illegals under the table instead, thus avoiding the crushing new minimum wage burden.

This is aside from the fact that a minimum wage hike of that level would be bad for a lot of ordinary citizens for a lot of reasons that free market economists point out all the time. I was just addressing the theory that raising minimum wage would decrease illegal immigration. It seems to me at least as likely that it would increase it.

I'm definitely a libertarian and I totally agree with Milton Friedman about welfare and immigration.

Libertarianism requires people who are individually self-reliant. Immigrants who come to the U.S. in order to partake of the welfare system, rather than to become self-reliant entreprenuers do not fit this requirement. Hence, you cannot have a libertarian society with such people, regardless of their ethnicity.

"Libertarianism requires people who are individually self-reliant. Immigrants who come to the U.S. in order to partake of the welfare system, rather than to become self-reliant entreprenuers do not fit this requirement. Hence, you cannot have a libertarian society with such people, regardless of their ethnicity."

This is the best summary of immigration problem for libertarian theory. Dry, almost mathematical, but makes me, who thinks the liberatrians are misguided children, totally agree.

Me thinks that there is much more to human societies than the freedom to engage in commercial transactions.

But nothing of that is required to show idiocy of liberal libertarian Mr. Wilkinson's position.
As Mr. Kurt9 has shown so well.

Several comments above, especially those from Daniel Larison and from Lydia, call for a reply, but I'm squeezed...for the moment, please check out my update, below the fold.

Mr. Wilkinson doesn't seem to realize that it's possible to increase your free rider problem in areas where you really cannot deny people the service in question. The word "welfare" can sometimes obscure this fact. But suppose we're talking about police and fire? You can be a moderate libertarian and still think that these are legitimate functions of at least the local government, yet they are always to some degree beset by free rider difficulties inasmuch as they are usually funded by property taxes from one group of people while the people who are likely to use them the most often don't pay property taxes. The importation of more impoverished people who will not be paying local taxes only increases this problem. Yet I think you'd really have to be a doctrinaire libertarian (read, "borderline nutso ideologue") to hold that the police should refuse to protect people or the firemen shouldn't put out fires for people who don't pay taxes. If nothing else, such silliness would endanger the taxpayers as well.

You seem to misunderstand Milton's comment. To say that free immigration is incompatible with a welfare state isn't to say we shouldn't have free immigration. It is to say that we shouldn't have a welfare state.

Indeed, if you are factually right about illegals overburdening the welfare system, then libertarians should cheer them on. That simply makes a bad system unsustainable.

Mr. Wilkinson doesn't seem to realize that it's possible to increase your free rider problem in areas where you really cannot deny people the service in question. The word "welfare" can sometimes obscure this fact. But suppose we're talking about police and fire? You can be a moderate libertarian and still think that these are legitimate functions of at least the local government, yet they are always to some degree beset by free rider difficulties inasmuch as they are usually funded by property taxes from one group of people while the people who are likely to use them the most often don't pay property taxes. The importation of more impoverished people who will not be paying local taxes only increases this problem. Yet I think you'd really have to be a doctrinaire libertarian (read, "borderline nutso ideologue") to hold that the police should refuse to protect people or the firemen shouldn't put out fires for people who don't pay taxes. If nothing else, such silliness would endanger the taxpayers as well.

Lydia
===================================

Lydia, you seem to want to redefine "welfare state" so that you can create an imaginary world where Milton's dictum becomes "free immiegration is incompatible with a state". Unfortunately, history is against you.

There were no restrictions on immigration any where until the 1790s and there was no restriction on immigration into the U.S. until the 1870s. [You do understand the difference between "residency" and "citizenship"?] Hence, for most of the time there have been nation states [i.e., since the early 1500s], they have been nation states with free immigration.

"Me thinks that there is much more to human societies than the freedom to engage in commercial transactions."

This is certainly true and is one of the reasons why I have never been able to read "Atlas Shrugged" more than once (I find "Voyage from Yesteryear" by Jim Hogan, to be far more up my alley). However, this in not an indictment against libertarianism itself. Libertarianism is about the freedom to pursue whatever personal dream or goal you may have, which may not be financial at all.

Mr. Bolton: I don't think that I misunderstand Prof. Friedman's comment at all.

When he says that "you can’t have free immigration and a welfare state," I think he means that you can't have free immigration and a welfare state.

Well, we've got a welfare state. More's the pity. So can we have free immigration? No.

You suggest that our de-facto open borders policy will eventually undermine the welfare state. "The worse, the better," as Lenin is supposed to have said.

Interesting if true, I suppose. But can you provide me with any empirical evidence to back this up? In California, which is on the front line here, the welfare state seems to be stronger than ever.

"You seem to misunderstand Milton's comment. To say that free immigration is incompatible with a welfare state isn't to say we shouldn't have free immigration. It is to say that we shouldn't have a welfare state."

Indeed.

When we say that something will happen when pigs will fly, we don't mean that we have to wait forever.
No, it is a call to breed pigs with small organic jet engines, so the poor creatures could, in fact, fly.

Aren't libertokiddies smart or what?

"You suggest that our de-facto open borders policy will eventually undermine the welfare state. "The worse, the better," as Lenin is supposed to have said."

Is there any evidence that the resulting state of the state will be in any way amenable to liberto-fantasies?

Isn't emergence of a crypto-fascist state just as likely? Or a Latin America type squalor and corruption as an organizing principle of a state?

Since we are engaging in liberto-fantasy, an easy approach to destroy US welfare state would be to import, say over 10 years, 300 Mil poor mexicans, bangladeshis, pakis, indians, nigerians and egyptians.

What system is likely to emerge from this liberto-experiment?

Even more important, how many people will be killed in resulting continent-wide upheavals?

"There were no restrictions on immigration any where until the 1790s"

Like when Muslim immigrated into Eastern Roman Empire and Barbarians immigrated into Western Rome.

A few cities were burn, a few slaves were taken, otherwise no problem.

Or when Arabs immigrated into Iberia.
Or when Russians immigrated into Poland and Central Asia.

In fact a mass movement of people into already populated country (and moving 500K or 1Mil people /year is a mass movement), was considered a war by the established residents.

"Libertarianism is about the freedom to pursue whatever personal dream or goal you may have, which may not be financial at all."

Fine. My personal dream may run right up against your goal.

How this is going to be resolved? Who will enforce contracts?

It is fairly clear that Wilkinson is a transi (sp?) a post-nation elite ideologue.

The 2 two examples of post-national structures we have, UN and EU, are so much less friendly to Liberto-dreams than many nation-states.

Perhaps Liberto-transies could apply their energies to explaining why EU is better for Libertos than the USA.

The irrelevancy of Craig B's references to immigration law prior to 1870 seems to me striking. Does it follow that because something was not a problem before it cannot become a problem now?

As for Frieman's dictum, I was not offering an interpretation in my references to free rider problems. I was merely pointing out that mass immigration may well cause difficulties even if we do not have welfare in the ordinary sense of that term.

"I was merely pointing out that mass immigration may well cause difficulties even if we do not have welfare in the ordinary sense of that term."

This is indeed true. There are fundamental differences in human beings that are not widely recognized because it flies against PC orthodoxy. Some peoples may simply not be cut out for life in a commercial republic as the founding fathers intended. The book "World on Fire" perfectly illustrates the problem even though the author, Amy Chua, was obviously too indoctrinated into PC orthodoxy herself to identify the cause directly (e.g. human biodiversity of cognitive ability).

My experiences in Malaysia tends to confirm every argument that is advanced by the human biodiversity crowd.

"Me thinks that there is much more to human societies than the freedom to engage in commercial transactions."

Of course. I like to sail hobie cats, kayak, and do a great many other things which are certainly not commercial transactions. However, I also like to engage in commercial transactions as well. I see no reason to believe that the freedom to do one set of activities precludes the freedom to do the other set. For example, my personal life experience is that the two freedoms are synergistic. My freedom to successfully engage in commercial transactions increases my freedom to engage in the activities that I really enjoy doing that are not commercial transactions.

Libertarianism ain't what it used to be, and I'll tell you one other thing: it never was what it was.

Interesting article. Scruton and Kirk have both made the point that libertarianism often is as dogmatic as Marxism. Both typically believe in Economic Man, and economic reductionism (all can be reduced to economics). Both libertarians (except Mr. Burton) and Marxists adhere to Procrustean theories, ready to excise anything that does not confirm to this world view.

Take free trade. It's destroying our economy and undermining our sovereignty. Yet, even if all the empirical evidence in the world, and God himself from up on High, demonstrated this fact so obvious to any man with common sense, the libertarian would reject this assertion simply because it does not adhere to his libertarian a priori model: all free trade is good. Paleolibertarians perhaps are a little better than libertarians, but even they still adhere to a Procrustean theory. While rejecting "managed trade" (e.g. NAFTA, WTO, etc.), they still believe in some form of ideal free trade (which must exist out there in the stratosphere with Plato's forms).

Immigration is just an all too obvious example of this failing. There is the other libertarian a priori belief: all immigration is good. This is in part due to our wrongheaded belief that all growth is good. Keep increasing the population, and the GDP will increase, although a larger GDP in no way translates to better lives or Americans. Already parts of the USA are becoming as populated as Europe (500 people per square mile), which is way too many people, especially if we want to maintain our beautiful countryside and a harmonious order, things irrelevant to the libertarian.

Kirk once said that he'd prefer the company of a culturally conservative European socialist than a Wall Street libertarian. Can you blame him?

Yes, I blame him. Procrustean? Socialists? Check.

Too often those who say such things have no sense of the importance of the free market.

(By the way, everyone, please note our new style buttons, thanks to Todd, our host and technological answer man!)

I have another scenario. Given the same libertarian village of 100 people, only instead of family of 4 arriving, a family of 20 shows up, with 20 more relatives in the van behind. If the village rejects them, they squat on land just outside of town, or on land that no one is using. They offer their services, substandard but cheap, to anyone who will buy. Soon the sturdy libertarians are hiring the new arrivals for all menial work, and allowing more to arrive. In time, the new arrivals outnumber the libertarians by 2 to 1 and decide to set up a new government via elections.

The libertarians can vote in the elections and lose, abstain from voting and lose, or sell out and leave. No matter what they choose, their libertopia has ceased to exist, by popular vote, thanks to demographics.

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