Is A Preferential Option for the Poor Bad for the Poor?

Admittedly this sounds like a silly question, but it is effectively one that Kyle Cupp is asking over at Vox Nova:

Putting aside whether or not the theory actually works in practice, a question I don’t here wish to debate, does trickle-down economics embody what has been called in Catholic circles the preferential option for the poor?

I’m inclined to answer that it does not, that while helping to generate pools of capital at the top may benefit the poor through a process of “trickling down,” the theory itself embodies a preferential option for the rich.

Kyle wants us to put aside the question of whether “trickle-down” economics actually works, so for purposes of considering the question we can assume that trickle-down does make the poor a lot better off than any alternative. So what Kyle is really asking here is whether a preferential option for the poor might require us to make the poor worse off (e.g. by rejecting trickle-down economics).

To me the answer is obvious: uh, no. And I confess that that I don’t find Kyle’s argument (that trickle-down is inconsistent with a preferential option for the poor because it also helps the rich) to be very compelling. After all, it’s a preferential option for the poor that we’re talking about here, not a preferential option against the rich. If we paid doctors to given free health care to the poor, this would benefit the doctors, many of whom are rich. Does it follow that paying doctors to give free health care to the poor is inconsistent with a preferential option for the poor? Obviously not.

That’s not to say I can’t sympathize with where Kyle is coming from here. Regardless of how it helps the poor, trickle-down economics just sounds bad (given that it’s a term only used to describe the views of one’s opponents this is not so surprising). But this is just a matter of rhetoric. During the last election I got pushed polled, and one of the questions was whether I supported Candidate X’s plan “to gamble with our Seniors’ future by privatizing Social Security.” When I told the telemarketer who was giving the survey that actually I thought that sounded like a great idea he laughed, because of course it didn’t sound good; the question had been deliberately designed to make the plan sound as bad as possible. But the fact that you describe a proposal in one way rather than another shouldn’t make a difference as to whether the proposal is actually a good idea. A rose by any other name and all that.

If you described “trickle-down” economics in a more neutral or positive manner (say, as the idea that for people to have jobs you first need to have employers) my guess is that some of the opposition would go away. And if you wanted, you could make out a decent argument that it is the left who really subscribes to a trickle-down theory (wealth is taken from the rich and given to civil servants and bureaucrats, who eventually pass some of it on to the poor; when you look at the percentage that actually does reach the poor, it’s fair to describe it as a trickle). But that hardly means that government programs are inconsistent with a preferential option for the poor.

All of which is to say that you ask sensibly ask whether something is consistent with a preferential option for the poor without asking whether it is good for the poor. You can’t ask whether trickle-down economics is consistent with a preferential option for the poor without asking whether or not it works.

50 Responses to Is A Preferential Option for the Poor Bad for the Poor?

  • It’s really depressing that you even have to make this argument.

  • It’s really depressing that you even have to make this argument.

    Indeed, but I always appreciate Blackadder’s posts on these type of things. He does common sense and objectivity justice and I think his style may lead some people think things through a little more. Well done, BA.

  • I am afraid that many people on the Left, I trust that Kyle is not in this category, hate the rich much more than they love the poor.

    The attitude is described well in an old Russian tale. A poor peasant lived next to a rich peasant who had a cow. The poor peasant found a lamp that had a genie in it. The genie granted him one wish. The poor peasant didn’t hesitate: “I wish the cow of my neighbor would die.”

  • And speaking of cows:

    “Feudalism: You have two cows. The lord of the manor takes some of the milk. And all the cream.

    Pure Socialism: You have two cows. The government takes them and puts them in a barn with everyone else’s cows. You have to take care of all the cows. The government gives you as much milk as you need.

    Socialism: You have two cows. The government takes one of your cows and gives it to your neighbor. You’re both forced to join a cooperative where you have to teach your neighbor how to take care of his cow.

    Bureaucratic Socialism: You have two cows. The government takes them and puts them in a barn with everyone else’s cows. They are cared for by ex-chicken farmers. You have to take care of the chickens the government took from the chicken farmers. The government gives you as much milk and as many eggs as its regulations say you should need.

    Fascism: You have two cows. The government takes both, hires you to take care of them, and sells you the milk.

    Pure Communism: You have two cows. Your neighbors help you take care of them, and you all share the milk.

    Russian Communism: You have two cows. You have to take care of them, but the government takes all the milk.

    Communism: You have two cows. The government seizes both and provides you with milk. You wait in line for you share of the milk, but it’s so long that the milk is sour by the time you get it.

    Dictatorship: You have two cows. The government takes both and shoots you.

    Militarism: You have two cows. The government takes both and drafts you.

    Pure Democracy: You have two cows. Your neighbors decide who gets the milk.

    Representative Democracy: You have two cows. Your neighbors pick someone to tell you who gets the milk.

    American Democracy: The government promises to give you two cows if you vote for it. After the election, the president is impeached for speculating in cow futures. The press dubs the affair “Cowgate.” The cows are set free.

    Democracy, Democrat-style: You have two cows. Your neighbor has none. You feel guilty for being so successful. You vote politicians into office who tax your cows, which forces you to sell one to pay the tax. The politicians use the tax money to buy a cow for your neighbor. You feel good. Barbra Streisand sings for you.

    Democracy, Republican-style: You have two cows. Your neighbor has none. You move to a better neighborhood.

    Indian Democracy: You have two cows. You worship them.

    British Democracy: You have two cows. You feed them sheep brains and they go mad. The government gives you compensation for your diseased cows, compensation for your lost income, and a grant not to use your fields for anything else. And tells the public not to worry.

    Bureaucracy: You have two cows. At first the government regulates what you can feed them and when you can milk them. Then it pays you not to milk them. After that it takes both, shoots one, milks the other, and pours the milk down the drain. Then it requires you to fill out forms accounting for the missing cows.

    Anarchy: You have two cows. Either you sell the milk at a fair price or your neighbors try to kill you and take the cows.

    Capitalism: You have two cows. You lay one off, and force the other to produce the milk of four cows. You are surprised when she drops dead.

    Singaporean Democracy: You have two cows. The government fines you for keeping two unlicensed farm animals in an apartment.

    Hong Kong Capitalism (alias Enron Capitalism):
    You have two cows.
    You sell three of them to your publicly-listed company, using letters of credit opened by your brother-in-law at the bank, then execute an debt/equity swap with associated general offer so that you get all four cows back, with a tax deduction for keeping five cows.
    The milk rights of six cows are transferred via a Panamanian intermediary to a Cayman Isands company secretly owned by the majority shareholder, who sells the rights to all seven cows’ milk back to the listed company.
    The annual report says that the company owns eight cows, with an option on one more.
    Meanwhile, you kill the two cows because the Feng Shui is bad.

    Environmentalism: You have two cows. The government bans you from milking or killing them.

    Totalitarianism: You have two cows. The government takes them and denies they ever existed. Milk is banned.

    Foreign Policy, American-Style: You have two cows. The government taxes them and uses the money to buy a cow for a poor farmer a country ruled by a dictator. The farmer has no hay to feed the cow and his religion forbids him from eating it. The cow dies. The man dies. The dictator confiscates the dead man’s farm and sells it, using the money to purchase US military equipment. The President declares the program a success and announces closer ties with our new ally.

    Bureaucracy, American-Style: You have two cows but you have to kill one of them because the government will only give you a license for one of them. The license requires you to sell all your milk to the government, which uses it to make cheese. The government pays lots of money to store the cheese in refrigerated warehouses. When the cheese spoils, the government distributes it to the poor. The poor get sick from the cheese, go to the emergency room, and are turned away because they have no health insurance. The President declares the program a success and reminds us that we have the finest health care system in the world.

    American Corporation: You have two cows. You sell one to a subsidiary company and lease it back to yourself so you can declare it as a tax loss. Your bosses give you a huge bonus. You inject the cows with drugs and they produce four times the normal amount of milk. Your bosses give you a huge bonus. When the drugs cause one of the cows to drop dead you announce to the press that you have down-sized, reducing expenses by 50 percent. The company stock goes up and your bosses give you a huge bonus. You lay off all your workers and move your production facilities to Mexico. You get a huge bonus. You contribute some of your profit to the President’s re-election campaign. The President announces tax cuts for corporations in order to stimulate the economy.

    Japanese Corporation: You have two cows. You redesign them so they are one-tenth the size of an ordinary cow and produce twenty times the milk. You teach the cows to travel on unbelievably crowded trains. Your cows always get higher test scores than cows in the U.S. or Europe, but they drink a lot of sake.

    German Corporation: You have two cows. You engineer them so they are all blond, drink lots of beer, give excellent milk, and run a hundred miles an hour. Unfortunately they also demand 13 weeks of vacation per year and are very expensive to repair.

    Russian Corporation: You have two cows. You have some vodka. You count your cows and discover you really have five cows! You have more vodka. You count them again and discover you have 42 cows! You stop counting cows and have some more vodka. The Russian Mafia arrives and takes over all your cows. You have more vodka.

    Italian Corporation: You have two cows but you can’t find them. While searching for them you meet a beautiful woman, take her out to lunch and then make love to her. Life is good.

    French Corporation: You have two cows. You go on strike because you want another cow, more vacation and shorter work weeks. The French government announces that it will never agree to your demands. You go to lunch and eat fabulous food and drink wonderful wine. While you are at lunch, the airline pilots and flight controllers join your strike, shutting down all air traffic. The truckers block all the roads and the dock workers block all the ports. By dinner time the French government announces it agrees with all your demands. Life is good.

    Political Correctness: You are associated with (the concept of “ownership” is an outdated symbol of your decadent, warmongering, intolerant past) two differently-aged (but no less valuable to society) bovines of non-specified gender. They get married and adopt a calf.

    Counterculturalism: Wow, dude, there’s like . . . these two cows, man. You have got to have some of this milk.

    Surrealism: You have two giraffes. The government requires you to take harmonica lessons.”

    Distributism: You name one of your cows Chesterton and one of them Belloc, and argue with them about what distributism means. Nothing much else ever gets done.

  • “Distributism: You name one of your cows Chesterton and one of them Belloc, and argue with them about what distributism means. Nothing much else ever gets done.”

    Hilarious and so true!

  • Now Don, that was as egregiously off topic as I’ve ever seen anything.

    But I laughed. Frequently. :-)

  • On topic:

    A lot of what I came away from that post with is the conviction that I’m not sure much of anyone is all that sure what exactly “preferential option for the poor means”. It seemed like, to the extent we got closer to such an idea, people agreed that it meant both intending to benefit the poor with one’s actions (perhaps specifically one’s actions in designing “the system”) and also that one’s actions really did succeed in benefitting the poor.

    In this sense, it seems to me that if “trickle down” works all one has to do is summon up the will do keep doing what one is doing for the benefit of the poor and one is all set.

    But if so, that seems to give the phrase a rather trivial meaning. I’m not sure if that’s a bug or a feature.

  • You can’t ask whether trickle-down economics is consistent with a preferential option for the poor without asking whether or not it works.

    The first commenter on my post, John C. Médaille, raised the same problem, and I concede that answering the first question may not be possible without answering the second. Perhaps I was too hasty in laying out my initial question. My aim was to focus the discussion, but my means seems to have wounded my argument. No pain, no gain though, as they say.

    The example you give of paying doctors to provide free health care to the poor clearly embodies (at least in intent) a preferential option for the poor because the policy is designed to help the poor. Helping the poor is the end, the goal, whereas paying the doctors is the means. Does trickle-down* economics do this as well? That’s my question. I think.

    *I didn’t mean to use trickle-down economics as a negative description, and I will happily use a more favorable term in the future. What do you suggest?

  • I’m rarely sure of the meaning of any word, Darwin, and I want to take that uncertainty as a feature rather that a bug, but I’m not sure even of that.

  • The example you give of paying doctors to provide free health care to the poor clearly embodies (at least in intent) a preferential option for the poor because the policy is designed to help the poor. Helping the poor is the end, the goal, whereas paying the doctors is the means.

    But if a doctors’ lobbying group was a big supporter of the plan, because they believed it would result in more money for doctors, surely the plan itself would (all other things being equal) remain a good idea even if the motives of the biggest supporters were in fact nothing to do with the poor, wouldn’t they?

    Perhaps, the doctors would derive no moral benefit if they were self interested about it — but wouldn’t the objective worth of the policy be the same either way?

  • I didn’t mean to use trickle-down economics as a negative description, and I will happily use a more favorable term in the future. What do you suggest?

    Voodoo economics.

  • The example you give of paying doctors to provide free health care to the poor clearly embodies (at least in intent) a preferential option for the poor because the policy is designed to help the poor. Helping the poor is the end, the goal, whereas paying the doctors is the means. Does trickle-down* economics do this as well?

    I think that the intent that matters here is one’s own intent. If I think that a given policy helps the poor but is being supported by others for bad reasons the thing to do is not to oppose the policy but to try and get people to support it for the right reasons.

  • Before we talk about preferential options for the poor, how about we define poverty? How about we discuss ways to measure it?

    I read in one of Thomas Sowell’s books the other day that only 3% of people considered “poor” in the United States remain so for longer than 8 years. In this country, people go in and out of poverty all the time by their own efforts.

    I don’t think poverty is really the problem in this country. It is the supposed injustice of vast disparities in wealth. I have a problem with that when it is the result of government intervention, but I have no problem with it when it is based on honest work and voluntary exchange.

  • As I understand it, “preferential option for the poor” means that as Christians, we should prefer actions and public policies which ACTUALLY benefit the poor and vulnerable over those which merely benefit ourselves or benefit people who already have wealth or power.

    However, what appears to benefit the poor in the short term may not be what benefits them in the long term. For example, if anti-poverty programs result in the government going broke trying to fund them, then one can plausibly argue that the “preferential option” requires an honest assessment of the state/nation’s ability to continue funding these programs.

    Here’s another example of how the preferential option might work. In many states, agencies are required to consider “regulatory flexibility” affecting certain classes of individuals or entities when rules and regulations are proposed. These may include small businesses, small municipalities, non-profit or charitable organizations, families, schools, etc. The idea is to insure that the effect of such rules upon these entities — which may not have the same ability or “clout” to lobby for or against a rule as others — is considered and not ignored. In that sense, you could say there is a preferential option for small business, etc. in these rulemaking processes.

  • ‘Trickle-down economics’ is a rhetorical thrust and only vaguely defined. When you assert it ‘works’, the appropriate response is, ‘toward what end?’.

  • Darwin writes:

    But if a doctors’ lobbying group was a big supporter of the plan, because they believed it would result in more money for doctors, surely the plan itself would (all other things being equal) remain a good idea even if the motives of the biggest supporters were in fact nothing to do with the poor, wouldn’t they?

    Perhaps, the doctors would derive no moral benefit if they were self interested about it — but wouldn’t the objective worth of the policy be the same either way?

    Yes and yes. The ulterior motives of big supporters may be cause for some suspicion, but ultimately the policy does or does not embody an option for the poor, and I think one can come to some conclusion about that without considering the motives of every supporter–even the big ones. In fact, I’d say the policy writers would be prudent to appeal to the self-interest of those affected and involved. There’s nothing wrong with that, necessarily, and it would most likely be vital to the success of getting the policy implemented.

  • Black Adder writes:

    I think that the intent that matters here is one’s own intent. If I think that a given policy helps the poor but is being supported by others for bad reasons the thing to do is not to oppose the policy but to try and get people to support it for the right reasons.

    Well said.

  • “…If we paid doctors to given free health care to the poor, this would benefit the doctors..”

    You joke, right? :)

  • The term “supply-side economics” is as good as any. It describes the same thing: that lower taxes on the rich will encourage the development of productive capital, which will increase the supply of goods and trickle down to the lower-income people.

    I think Kyle’s question is valid, and it’s one I’ve wrestled with. I think that supply-side economics can be morally acceptable, but it’s tricky. For example, if you say that present injustice is to be encouraged if it leads to better conditions in the future, how is that not consequentialism? That has some ugly implications in terms of means and ends, as well as a tradeoff between morality and comfort. It’s a delicate question.

  • Cutting taxes on the wealthy to zero would help the poor. The preferential option requires that policies actually prefer the poor relative to the rich. That doesn’t mean any one proposal must prefer the poor but overall the system must help the poor more than the rich.

  • Strictly speaking supply side economics has to do with marginal income tax rates (not just taxes as such) on high income earners (not the rich as such). The real idea is that a reduction in marginal rates yields more productive behavior, resulting in a vibrant economy including job creation. Indeed one tenet of supply side theory is that a reduction of marginal tax rates can in some circumstances result in greater tax revenue without any reliance on the Keynesian multipier effect. To understand this one need only imagine a world with a tax rate of 100%. Such a world would yield exactly the same tax revenue as a world with a 0% tax rate — i.e. 0, at least in a free society. It is axiomatic to most free market theorists that no one would work or invest if 100% of one’s compensation for such work or investment was paid to the government. Plainly, a curve exists (albeit one that is much easier to understand in principle than identify or apply in practice) which describes the relation between tax rates and government revenue, and only one place on that curve is optimal for maximizing government tax revenue. Of course, maximizing government tax revenue is not necessarily a dispositive objective of tax policy, but reasonable people should agree that it is not sensible to set rates beyond that optimal point (although Obama suggested otherwise in the presidential campaign in regards to capital gains rates).
    Also, while there is a relationship between the “rich” and high income earners, in this country that relationship is pretty weak. Most high income earners are not rich by any reasonable standard.

  • Mike, nearly every economist agrees that we’re no where near the Laffer peak.

  • Mike – All good points.

  • I also think the fuzziness and newness of the term “preferential option for the poor” makes it insufficient grounds for altering an economic system.

  • I think you need to be careful how you justify purchases or other actions with the trickle-down effect. For example, is it preferable for the poor for you to justify buying a yacht assuming the yacht makers employ poor people or is it preferable to give that money to a charity who feeds and educates the poor so that they can find a better job than yacht making?

    I think it’s dangerous to assume that selfish purchases are also benefiting the poor. Preferential option for the poor is preferring the needs of the poor before all other needs and wants including your own.

    From the compendium of the Social Doctrine of the Church:

    The principle of the universal destination of goods requires that the poor, the marginalized and in all cases those whose living conditions interfere with their proper growth should be the focus of particular concern. To this end, the preferential option for the poor should be reaffirmed in all its force. “This is an option, or a special form of primacy in the exercise of Christian charity, to which the whole tradition of the Church bears witness. It affects the life of each Christian inasmuch as he or she seeks to imitate the life of Christ, but it applies equally to our social responsibilities and hence to our manner of living, and to the logical decisions to be made concerning the ownership and use of goods. Today, furthermore, given the worldwide dimension which the social question has assumed, this love of preference for the poor, and the decisions which it inspires in us, cannot but embrace the immense multitudes of the hungry, the needy, the homeless, those without health care and, above all, those without hope of a better future”

    As Jesus tells us, “whatever you did for the least of these you did for me.”

    Do you want to tell him that you cared for the poor by buying a yacht (or some other selfish purchase)? or would you rather say that you fed the hungry, clothed the naked, and educated the uneducated?

    If you say both, then how do you know? How do you know it actually trickles down? The current income inequality in America with the lowest progressive taxation we’ve had in decades shows that it does not.

  • RR, I never suggested otherwise. But even if true (I honestly don’t know) it does not follow that it is good economic policy to raise taxes. Only a true statist would say that it is axiomatic that tax rates should always be set to maximize government revenue. All the Laffer Curve really suggests is that rates should never be set higher than the point at which revenue maximizes. It does not suggest that that point is “optimal.” That question is as much normative and prudential as it is positive and computational.

    Unlike libertarians and some conservatives, I have no problem in theory with government acting as a charitable social agent. But in evaluating what would be effective (leaving aside fair), one must have a pretty sober understanding of human nature and how real people will respond to various conditions. My experience suggests that government programs are viewed as entitlements, and entitlements have a very perverse effect on the behavior of their intended beneficiaries. Private charity does much better.

    Also, there will always be a tension between those who view poverty through a fairly absolutist lens and those who see it through a relativist one. Some of us believe that access to very basic housing, food, and health care is sufficient; others will always be uncomfortable with disparity. I’m kind of in the middle but do acknoledge that much of the sentiment of the latter group is grounded in plain old envy.

  • “Do you want to tell him that you cared for the poor by buying a yacht (or some other selfish purchase)? or would you rather say that you fed the hungry, clothed the naked, and educated the uneducated?”

    What if you tell Him that by establishing a yacht selling business you provided employment for 50 men and women so that they could feed, clothe and educate their families? These questions are a good deal more complicated than many people make them out to be. The best anti-poverty program for most folks is a good education, a stable family and a good job. Government programs tend to be rather poor at supplying any of these.

  • Can anyone give me a chapter and verse citation where Jesus uses the term “preferential option for the poor?”

    I’m working from Mark 14:7.

  • Jesus never uttered that phrase.

    I think this whole idea has been understood too materialistically.

    There is also spiritual poverty. But we think that if people are materially well-off their chances of becoming spiritually wealthy increase. I don’t think that is that case.

  • RR,

    Cutting taxes on the wealthy to zero would help the poor. The preferential option requires that policies actually prefer the poor relative to the rich. That doesn’t mean any one proposal must prefer the poor but overall the system must help the poor more than the rich.

    I’m a little confused here. Are you saying that if a policy helps both the poor and the rich, it is only acceptable under the “preferential option for the poor” if it helps the poor more than the rich?

    What if some policy helps the rich more than the poor, but still helps the poor more than the alternatives? Should one avoid it on the principle that it would help the rich more than the poor, and that this would add to inequality and thus be unjust?

    Also, if “the system” as a whole benefited the poor more than the rich, should that simply mean that the former poor should be poor anymore and that someone else (the old rich?) were now poor?

    More generally,

    - Maybe it’s just a vague feeling from the terms used, but I have the general feeling that “preferential option for the poor” is used to mean some sense in which someone has their thumb on the scale to tilt some system more in the direction of the poor than would otherwise be the case. That we’re not just talking about some policy which in some sense benefits them, but that in some way you take “a system”, then sque it towards the poor and go with that. Is there any basis for this or am I being led down a wrong path?

    - It also seems to me that the entire idea of the “preferential option for the poor” as usually expressed assumes that there are multiple economic “systems” and that one can pick or modify “the system” in such a way as to assure that “the poor” as a class are the prime beneficiaries of ” the system”. However, I’m really not clear that this is in fact true about economies — that is, I’m not clear that there is multiple “systems” one may pick from, some of which will necessarily and always benefit the poor more than others. I think maybe this becomes easier if we assume that the “preferential option” is something to be implemented civicly rather than economically, but I’m still a bit skeptical of the idea that one can design a “system” as a whole, civicly or economically, which primarily benefits “the poor” over others.

  • Mac,

    ” . . . many people on the Left, . . . hate the rich much more than they love the poor.”

    It’s not hate. And, they do not love the rich less. They love the poor more. Jesus did not teach one should love certain of one’s brothers more than evil, rich brothers. That’s in the Gospel of Marx.

    Another name for it is class war.

  • If a given program helps both rich and poor, then it’s probably going to help the poor more than the richer (in real, as opposed to nominal, terms).

  • A question?

    Why do we keep saying a preferential option for the poor when the Catechism of the Catholic Church, and to my knowledge all Church teaching, to my knowledge, makes a point of saying not “preferential option” but “Love For the Poor”? [Note: I have never been able to find a online version of the original Spanish to see what the Latin American Bishops actually taught.]

    I suspect one reason relevant to this discussion is that “option” could be understood as a program, those unenlightened heathen who do not support it are doomed to hell. Where as “love” would imply the Cardinal Virtue of Justice Justice is the moral virtue that consists in the constant and firm will to give their due to God and neighbor. Certainly two people could have an equally “constant and firm will” and have mutually exclusive ideas on how that applies in a given situation.

  • and to my knowledge all Church teaching

    should read

    and to my knowledge all Church teaching at that level

    The definiton of Justice above is from the Catechism

  • DarwinCatholic, I’m confused too. For example, what if a free trade agreement with Japan meant that cheap Japanese robots would replace American nannies? I would argue that this shouldn’t be done unless there is a safety net for the newly unemployed. The preferential option isn’t limited by immigration status so I’d argue that we should oppose policies that impoverish even illegal immigrants.

    I think if we had a system that provided a sufficient financial safety net and opportunities for improvement, we would have fully exercised our preferential option since there would be no more poverty except for poverty by choice. This is why I no longer view the earned income tax credit as the ideal anti-poverty program. It still keeps people in poverty since it can’t provide a 100% credit. I think the ideal safety net must bring people completely out of poverty. We can still have work requirements but then jobs must be guaranteed. Sweden has such a program. They place people in private jobs which ends up creating more unemployment. I would place people only in public sector jobs, however menial. What if instead of giving unemployed bankers unemployment benefits, we offer them a job at the SEC for minimum wage?

  • “The principle of the universal destination of goods requires that the poor, the marginalized and in all cases those whose living conditions interfere with their proper growth should be the focus of particular concern.”

    I may be splitting hairs here but “particular concern” is not necessarily the same thing as “preferential option.” Particular concern, as I interpret it, means simply that the good of the poor and marginalized have to be seriously considered in economic decision making — which is entirely reasonable and possible. The effect of any economic policy upon the poor should never be dismissed or ignored. Even less should the poor be unfairly stigmatized or treated as unworthy of concern.

    “Preferential option,” on the other hand, seems to imply (or at least seems to be commonly interpreted to mean) that the poor are always in direct competition with the middle class and wealthy and that all economic decisions must benefit the poor to a greater degree than everyone else — which is highly impractical if not impossible.

  • If a given program helps both rich and poor, then it’s probably going to help the poor more than the richer (in real, as opposed to nominal, terms).

    Agreed. Though people who talk about the preferential option for the poor most seem to completely fail to understand the distinction between real and nominal terms and get mad at such a situation instead.

  • For example, what if a free trade agreement with Japan meant that cheap Japanese robots would replace American nannies? I would argue that this shouldn’t be done unless there is a safety net for the newly unemployed.

    By that argument, wouldn’t one ban most economic growth? The invention of the car pretty much wiped out the poor buggy whip makers.

    I think the ideal safety net must bring people completely out of poverty. We can still have work requirements but then jobs must be guaranteed. Sweden has such a program. They place people in private jobs which ends up creating more unemployment. I would place people only in public sector jobs, however menial. What if instead of giving unemployed bankers unemployment benefits, we offer them a job at the SEC for minimum wage?

    On the general point — perhaps I don’t know enough about Sweden but I’m not clear that any country has completely eliminated poverty.

    On the idea of putting unemployed bankers to doing minimum wage work at the SEC — that probably depends a lot on whether you want anything done well at the SEC. Also, many people tend to claim that the minimum wage is in fact a poverty wage. Honestly, I can’t see what exactly the attraction is of making people who are receiving a cash benefit because they ware out of work do some sort of make-work. It gets very little productive done, probably costs more to run than just giving the money, and keeps the unemployed person from being able to spend all their time looking for work or getting new training.

    General point again:

    At the risk of getting the “bad catholic” pile on from the left: It really sounds to me like “preferential option for the poor” has no clearly agreed upon meaning which wasn’t well and clearly understood in Catholic moral teaching for a couple thousand years before the phrase was dreamed up. Given this, I’m not sure how much people are adding to discussion by throwing it around as if it meant something.

  • By that argument, wouldn’t one ban most economic growth? The invention of the car pretty much wiped out the poor buggy whip makers.

    The invention of the car brought more people out of poverty than put into it. That’s why I used the Japanese robots replacing nannies hypo. In either case, the goal isn’t to ban creative destruction but to protect the poor. That can be done with things like welfare, education, and job placement. If a safety net isn’t an option, I guess you’d have to weigh the effects of the creative destruction on the poor and decide whether to ban it.

    Sweden might have poverty. There may be people unwilling to work. As for the guaranteed job placement, it isn’t intended to provide value. It’s intended as make-work but if we’re going to give out money anyway, it makes getting on welfare less attractive. Also, from a CST POV, it provides the dignity of a job. Like the Swedish program, you’d be required to submit proof that you’re actively applying to jobs.

  • “The invention of the car brought more people out of poverty than put into it.”

    No one knew that at the time. For the first few decades of the “horseless carriage”, they were out of reach of most of the middle class and all of the poor, and precisely the type of expenditure that some people in this thread would have blasted as a luxury for the rich that could have been better spent on the poor. Precisely the same thing could have been said about the early stages of personal computers and virtually of any new technology entering the economy. This is why running an economy based on fairly vague “feel good” admonitions from ecclesiastical officials is almost always going to end in economic disaster. The Church tells us to remember the poor and we have a duty to care for them, and I view that as entirely true. When Church leaders go from there to trying to tell us how to run an economy they are treading into an area where they have no expertise and their recommendations have to be examined with the same care we give to economic recommendations from any source.

  • Economic policy affects the poor. The preferential option doesn’t dispute any economic theories. It only insists that the moral problems be addressed. It doesn’t prohibit creative destruction but it requires that we try to mitigate the destruction part. Too often an economic policy that creates a net reduction in poverty ignores the fact that it can throw real people into poverty.

  • For example, what if a free trade agreement with Japan meant that cheap Japanese robots would replace American nannies? I would argue that this shouldn’t be done unless there is a safety net for the newly unemployed.

    I think you are confusing the issue of free trade with the issue of automation. Take a more realistic example: automated checkout lanes at supermarkets. Instead of having someone working at every checkout lane, you have lanes where people scan their own items and pay with a credit card. Do you think that should be banned? Or take self-serve gas stations. My understanding is that there are some parts of the country that ban self-service gas pumping on the grounds that it destroys low skill jobs. If you want to buy gas you have to wait in your car and a nice attendant will come out and pump your gas for you. Should that be required throughout the country? For that matter, lots and lots of jobs in manufacturing and agriculture that used to be done by low skill workers but are now done by machines (if you visit a car plant it’s amazing how much of it is automated). Should all of that be restricted?

  • The preferential option doesn’t dispute any economic theories. It only insists that the moral problems be addressed. It doesn’t prohibit creative destruction but it requires that we try to mitigate the destruction part.

    Okay, I don’t disagree with that. I wonder, though, why you don’t think the EITC is an ideal solution?

  • I used the free trade in robot nannies example because it would disproportionately help the rich but it doesn’t really matter. Is there a moral difference between repealing existing protectionist measures and refusing to enact new protectionist measures? The poor may rely on existing protectionism (e.g., trade barriers on Japanese robot nannies) like they rely on Medicare and Social Security. Liberalization can be just as harmful to them and helpful to the economy as taking away their entitlements. Even most hardcore libertarians don’t want to immediately cut off entitlements. On the other hand, new protectionist proposals (e.g., requiring that all gas stations be full-service) create reliances that don’t yet exist.

    I’m not for any protectionism if there is a sufficient safety net for the losers but it seems to me that if that’s not an option, the preferential option demands that we protect existing reliances.

  • As for the guaranteed job placement, it isn’t intended to provide value. It’s intended as make-work but if we’re going to give out money anyway, it makes getting on welfare less attractive. Also, from a CST POV, it provides the dignity of a job.

    I guess I wouldn’t tend to see useless make-work as providing the dignity of a job — if anything, it would seem like just as counterfeit money degrades the value of real money, so putting a significant percentage of people in make-work jobs would degrade the perceived value of real work.

  • The EITC would be my second choice. The problem is that it keeps people in poverty because you can’t provide a 100% credit of the amount they fall short of the poverty line. If you increase the income threshold under which people are eligible, people who aren’t in poverty would receive the credit too. Also, I’d like to see a work requirement which is harder to justify it if you don’t guarantee work. Finally, I think working, even if it’s a menial government job for minimum wage, is more dignified than collecting welfare.

    DarwinCatholic:
    if anything, it would seem like just as counterfeit money degrades the value of real money, so putting a significant percentage of people in make-work jobs would degrade the perceived value of real work.

    Counterfeit money degrades the value of money by increasing supply. I don’t think we should restrict jobs just because scarcity makes jobs more valuable. And unlike counterfeit money, a min wage job can’t be passed off as something more valuable. It may discourage demand for comparable min wage jobs in the private sector but there would also be job seeking requirements that require participants to take private sector jobs if offered.

  • I realized as I was typing it that it would be easy to mistake me for talking about the economic value of work, but I’m in fact talking about the societal value of work.

    It seems to me that we already have a problem of sorts in that many people do not see their jobs are particularly productive, and thus there is a societal perception of a job as being “some stupid, useless thing I go do so that corporate overlords will give me my paycheck”. If at this point in time we had 10% of the population doing work that was intended to be useless make-work, we would completely undermine any cultural appreciation for the dignity of work in our society.

    Perverse as it may sound, it seems to me that if simply paying people cash unemployment benefits lacks the dignity of work, this actually is a feature, because it underscores the social importance of getting a job in order to get off the dole.

  • Is there a moral difference between repealing existing protectionist measures and refusing to enact new protectionist measures? The poor may rely on existing protectionism (e.g., trade barriers on Japanese robot nannies) like they rely on Medicare and Social Security.

    Are there existing trade barriers to importing robot nannies from Japan?

    It seems like the main effect of banning robot nanny imports from Japan would be to move production of the robot nannies to the U.S. That would mean we’d have to give up making something else here. And presumably what we would have to give up making is something we were better at doing (otherwise there’d be no point in importing the robots from Japan instead of making them ourselves) Which means that our productivity would be lower. That the poor would be helped by this is far from clear.

    The EITC would be my second choice. The problem is that it keeps people in poverty because you can’t provide a 100% credit of the amount they fall short of the poverty line. If you increase the income threshold under which people are eligible, people who aren’t in poverty would receive the credit too.

    That’s true, but so what? Lots of existing entitlements go to some people above the poverty line, why not the EITC?

  • Protectionist policies designed to protect existing jobs as opposed to attempting to create new jobs doesn’t move jobs anywhere. Productively would remain constant though it would eventually lag other countries. Since all I’m worried about is the poor who already rely on protectionism, it can be phased out over time. I don’t care if we don’t have any more corn growers in 50 years but those who rely on it to make a living now need protection. Again, my preferred method is direct cash payments instead of protectionism but I’m assuming, for sake of argument, that that isn’t an option.

    I don’t think an EITC that fully subsidizes the poor and the near-poor is horrible but I think make-work could be better. You don’t have to subsidize anybody but the poor. There’d be additional administrative costs but they’d be small compared to more tax credits. Anyway, it’s a theoretical preference that could change if I’m shown contradictory real-world data.

  • Joe Hargrave:

    “I think this whole idea has been understood too materialistically.

    There is also spiritual poverty. But we think that if people are materially well-off their chances of becoming spiritually wealthy increase. I don’t think that is that case.”

    Very good point! The use of all earthly goods should be ordered toward obtaining heavenly goods. Charity is as much for the rich as it is the poor!

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