dealing with friedman (2) - thoughts on the welfare state

To Friedman the redistribution of income through the state is not desirable. It widens the gap between the poor and the rich – and that is the opposite of the original intention of the welfare state. Incompatible with ones freedom to pursuit happiness individually, a positive attitude towards governmental influence in favour of the hapless is to Friedman like believing in “dictatorship, benevolent and maybe majoritarian, but dictatorship none the less.”

Welfare measures such as public housing, minimum wage laws, farm price supports and social security have counter-productive effects. Friedman’s main concern is that the original needs for implementing those measures cannot be satisfied – but once the government takes control over the issue the borders blur and state intervention increases. One example is the need for restrictions on import once you start guaranteeing high prices for farm products and high wages for farmers. The vicious cycle then goes on with individuals being left with fewer choices, fewer companies, higher chances of monopolization and the like. It is simply that “one cannot be both an egalitarian, in this sense, and a liberal.”

Gerald Allen Cohen, author of “Karl Marx's Theory of History: A Defense (1978, 2000)“ must get in rage every time he is confronted with Friedman. The existing inequalities he is commenting on have not much to do with Friedman’s version of a nation state that is built on the principles of equal opportunities and rights. Devoted to egalitarian political principles Cohen objects the “misuse” of the “concept of freedom” by libertarians and liberals. He is accusing them of having “highly anarchic imaginations” if they are advocating, and Cohen quotes Flew, “wholehearted political and economic liberalism, opposed to any social and legal constraints on individual freedom”. But this is not Friedman. “My freedom to move my fist must be limited by the proximity of your chin” can be read in his book. Friedman thinks that in order to reduce poverty a program much more effective than government welfare, a program that aims directly at poor people (not old, unemployed… etc), should be implemented, a program based on a negative income tax. Therefore households with higher income would have to pay more taxes, low income households would receive payments, financed by those taxes. People would receive cash, Friedman thinks that’s most effective to save personal freedom. So, there IS awareness for the problem and possible solutions are presented. Cohen’s assumption that liberalism automatically means to create a sphere where all individuals are literally free to do what they want is wrong. Friedman knows that and concentrates on finding the thin lines between acceptable interference by the state and abuse of power. And when Cohen points out that “a capitalist society with no welfare structure would endanger the very lives of those who…are unemployed”, Friedman would argue that the free individual is free to give money to the poor – and in a realm of existing civil liberties everybody is free to convince other people that they should do so. So, liberalism is not automatically opposed to a caring society even though this is a somehow naïve expectation. It would be perfectly possible to give shelter and food to all homeless people in the United States if the wealthy would share some of their funds. It does not happen. Do you need to abolish existing welfare measures to find that out?

But for Cohen, all of Friedman’s arguments rest on an unjust foundation anyway. Contradictive to natural rights, the allowance of “private ownership of means of existence” through the market is out of the question.

Both see the present system in urgent need of reform but the solutions they present point in completely different ways. Once again, it is the “primacy of the free market” versus the “abolition of private property”.