A New Verdict For Welfare

...The failure to extend private property rights to commonly owned resources has worsened the environmental problem, as have the activities of several governmental agencies, such as the Army Corps of Engineers...

...Tariffs and patent laws have lessened competition...

...Millions may "'like" or "'approve of" mal~arine, but whothex they buy it depends on the relative price of Imtter...

...This obstruction did not silence academics who felt drawn to examine alternative "models" of financing welfare...

...For him liberty is the primary political value...

...Best advice is to forget what time it's supposed to be...

...The libertarian refuses to make this sacrifice...

...Most unfortunately the failures of governmental activity have been commonly attributed to the free market and have in turn given rise to additional state programs...

...Boyson, he can be fairly criticized for being too jolly well determined to cram everything into one of these pre-set temporal categories...

...After a careful weighing of Page's evidence, I conclude that British trade union practices might -- just conceivably -- have made even the late Mrs...

...Rhodes Boyson's collection of critiques should swell those ranks...

...xt was to appty ~re4agged t e s t ~ of p r d ~ that the Institute tentat~eay ~ with ~s rust Choice m Wellure sorvey in 1963...

...Second, direct payment facilitated by insurance would release welfare services from the limit imposed by popular objections to paying more through taxes...

...In this way the producers' desire to maximize profits causes the free market to automatically approximate the following condition for economic efficiency: the economic cost of the last unit of goods produced must equal their subjective benefit to consumers...

...Boyson divides his selections into three categories: Yesterday, Today and Tomorrow...

...The dtizens did not seem to be so ,m~mor~ with Socialist regulations as the politicians...

...The free market possesses an automatic feedback mechanism which discourages a firm that fails to satisfy consumers' demand at appropriate costs from staying in business...

...Despite the superb quality of analysis displayed in most of the essays, the book suffers from a minor blemish, and the fault is the editor's...

...university subsidies) as a fat buy-off for tolerance of "poverty-aimed" programs (Buekley once aptly described this general phenomenon as "'the economy of the criss-crossing dollar...

...The politician who promises a rapid government-1 solution to a pressing problem has an advantage in a campaign...

...As these academic innovators developed more sophisticated alternatives to the crisis-prone state system, the skepticism and cynicism of those who dismissed the liberal innovations as "'politically impossible" seemed increasingly perverse...

...Richard Crossman, who most bluntly voiced the commonsense view that people will expend more money in direct payment for better welfare than they will pay in taxes unrelated to the services they receive...

...The hidden costs of this proposal, though, are the inefficiencies introduced as a result of both the reduced incentives to work for rich and poor alike and the decline in savings and capital formation...

...However, the reader searching for trenchant factual brickbats equally suitable for slinging around at cocktail parties and in scholarly papers should content himself with the two best selections, Robin Page ("Strikers of the Queen") and Alfred Sherman ("Council Houses' Crttmbling Foundations...

...at the University of Chicago...

...The result is mounting pressure to improve service combined with stiffening resistance from taxpayers to government expenditures...

...No other country has gone so far as Britain in discouraging fees, charges and insurance by supplying medical care and education without direct charge to those families who could pay...

...It was two Labour Ministers for the Social Services, Mr...

...Efficiency...

...There developed widespread "'nnm~eptuble" checks on immigration, massive support for -~nthinkable'" cm'bs ~m the power of trade ,minus, lmpularity of the reintroduction of-'hmdmi.~sible" medical clmrges, etc...

...Economic power is decentralized and, most importantly, is not in the hands of the state, which has historically represented the primary threat to liberty...

...Certainly enthusiams for state welfare could not be deduced from the ninety-five per cent reliance on state schools or the ~ Parents nmst be very well-off or self-sacrificing to Im-n from "'free" services and pay privately for services after their incomes are left ravaged by nmdern taxatimL The only other guides to public opntinn were the surveys which ~k~ people whether they "'lled," "'supported," or "'favored" the NHS, for example...

...Striking workers are depicted as 10 The A l t e r n a t i v e ; March, 1972...

...Our Brittanic Cousins have had no more luck with their frontal assault on poverty than has the OEO...

...This responsiveness of producers to consumer demand is why free market competitive capitalism has been termed a system of consumer sovereignty...

...As with market resean~ conducted by ~t~wy, customcr can make a sik~i~eant choice only by compar~ the product or service will] a priced altcrnative...

...Not surprisingly such surveys produced large majorilies answering "'Yes...

...Hearing none, I continued, but so great is my lightoingphobia that my golf game now suffers from an uncasual interest in any dark clouds gathering in the firmament...

...But it does not follow from this view that free markets ought to be dispensed with, because income can be redistributed by taxation and transfers outside the market, e.g., by a negative income tax...

...even the government's performance of its basic functions has been very spotty...

...Without great prejudice to Dr...

...And with educatinn ana ~ care more persons than in earlier surveys would now pay for the opportundty of a ehoice: over forty per cent with children of school age expressed interest in taking a voucher valued at two-thirds of school fees and adding the third out of pocket, and over thirty per cent favored a two4hird value voucher for health insurance...

...our essay on socialism by Tom Milstein of the Young People's Socialist League was los.t in the postal system - - an inauspicious circumstance for any essay proposing extended government services -- and will be featured in our April number...

...All systems fall short of perfection, but the emerging challenge for students of the "welfare state was how to mingle the equity of public finance with the efficiency of private payment...

...Perhaps the most significant reason, however, is that the values of the electorate are changing...

...Indeed, provoked by the complacency of sociologists and political commentators, independent economists associated with The Institute of Economic Affairs have, since its foundation in 1957, persisted in asking unpalatable questions...

...Both conservatives and libertarians will, however, want to avoid the book on an empty stomach...

...Leonard g~s (_tlh~n of M~rvafion) supervised a national survey among 2,000 family dec/sion-makers (taken as male heads of hoaselmlds aged 21 to ~ ) . "me elaborate questionaire informed ~ of e~ts and alternatives before inviting an expresof "nmero-eemomic" l i ~ f ~ betwe~ bread alternative l~l#i~ of ~ymg Ira" weffare b.v taxes or by mm~et p r i c ~ andof ~ ~ mie" personal preferenc~ between state or private education and medical care...

...For release reading a good Heinlein scifi novel is vastly better and a Jehovah's Witness pep rally a danm sight more cheerful...

...He is always worth reading...

...Those who scoff at him today may wish in years to come that they had listened to him while there was still time...

...Boyson's stable of writers lists some familiar reasons: destruction of individual initiative, bureaucratic proclivities for more of the currently fashionable programs without regard for result, interest group logrolling which channels much government effort and resources to the well4o~lo (e.g...

...Furthermore, the lobbying system matches the powerfully represented special interests of producer and worker organizations against the weakly represented common interest of all consumers...

...The essence of their liberal critique was whether a monolith dependent on taxation could raise standards in welfare to match the affluence generated by competition and choice in free markets...

...This work is the second product of the Constitutional Book Club, one of the organs of the British "'New Right...

...We are confident his essay is well worth waiting for...

...Douglas Houghton and Mr...

...The Queen's poor are still poor despite "'social spending" to the tune of 45 per cent of her GNP...

...Most economists concede ~ that free markets in actuality will not achieve complete economic efficiency because perfect competition will not always exist and because the market price will not reflect all the economic costs and consumer benefits of a good in the presence of external neighborhood effects...

...Crossman, to question the sample and the technique...

...George Stigler expresses the spirit of the pragmatic" arguments for laissez-Iaire: Any economist who wants the government to act "whenever the market falls short of perfection is like a judge in a singing contest who awards the prize to the second singer merely on the basis of having beard the first...

...The political process does not possess an effective negative feedback mechanism to eliminate programs that fail...

...Voluntary transactions in the free market represent relationships among free men...

...It is too easy to imagine one's ethereal self writing identical prose about the good ole USA ten years down the road...

...Just as high profits signal that output should be increased, losses signal the opposite...

...In Britain clearly the of change were blowng for a freer society...

...A student oJ Milton Friedman, he received his Ph.D...

...If his program, when enacted, fails to work, it nevertheless becomes entrenched...

...The l i n d . s were s~fici~utly at odds with the presum~ o~sensus to provoke critics, not least Mr...

...A smaller survey among women (to meet earlier objections about our male sample) indicated even stronger support for choice than among men...

...It denies kidney machines to save life but removes tattoo marks t save pride...

...These are but a few of many examples...

...Political "leaders" should have learned something from the Britain Unfortunately...

...Such unexpected findings are bound to provoke continued argument on detail and interpretation, but two concinsions seem difficult to resist...

...F OR MORE THAN twentyfive years since the inauguration of the Butler-Bevemdge regime of universal government provision, intellectual debate on the British welfare state has been inhibited by the undemonstrated objection that radical reform is "'politically impossible...

...Alternative welfare arrangements are plainly feasible...

...Page claims that "'industrial anarchy" in Britain is quite as sacred and institutionalized as the crown, idolized by the government near-monopoly of the electronic media, and sustained by taxes extracted from its victims...

...Roosevelt blanch...

...Practice confirms what economic theory predicts: when pricing is suppressed, scarce resources are wasted and urgent needs denied...

...Some opponents of free markets argue that a distribution of income according to what a person and the resources he owns add to the value of production -- the principle of distribution in the free market -- is inequitable...

...Minimum wage laws and urban renewal programs have reduced the employment and housing opportunities of the disadvantaged...

...In fact, the record of governmental economic programs is poor...

...In 1.q~, when the survey was repeated with variatiaos to meet criticisms, the ~ Vote in favor of private welfare iook~ all the more impressive...

...Any semi-serious student of limited government will find Milton Friedman (the only American writer in Down with the Poor and a "yesterday" in the Triple Entente...Friedman should be used to being called a man of yesterday since Time does it to him all the time) on "'Special Interests and the Law" to be old fedora, but vintage Friedman nevertheless...

...Paul, Minnesota...

...His views are certainly unfashionable...

...Improper monetary management has contributed to both depressions and inflations...

...First, opposition to radical reform in Britain's What a Day May Bring state welfare seems to be changing into support...

...Milstein is a first-rate advocate...

...Is it reasonable to expect state intervention to mitigate these inefficiencies...

...David E. Lindsey is an assistant professor of economics at Macalaster College in St...

...After i u t ~ i v e pilot interviews, Mr...

...People seem to be ever more willing to sacririce economic freedom in order to realize an apparent gain in income, security or equality...

...British conservatives (note absence of cap "'C") are still scarce enough to hold their national convention on a street corner without a police permit, but one should be encouraged that there are a few Limeys who prefer to remember Fabian as an American rock singer...

...I listened for grave-ruml~ling while penning that statement...

...does not necessarily imply equity in the distribution of commodities, however," because views about equity differ widely...

...The critical flaw in Britain's National Health Service "model" is that when a service is provided "'free" it embodies no mechanism to' sort out priorities and ensure economy by suppliers and users...

...Choice in Welfare 1970, Ralph Harris and Arthur Seldon, published in 1971 at Institute of Economic Affairs, 2, Lord North Street, London SW1 r~OWN WITH THE POOR 1 , J is an exquisite little compendium of case histories administering a long overdue drubbing to Britain's welfare state...

...But if the editor deserves a kick in the bleep for his organization, he deserves a kiss on the forehead for the intellectual guns he has brought together for us under one small cover...

...It is this needless constraint, belatedly recognized by politicians, that has held back the expansion of medical care, pensions and education...

...Hence far from proposing that state welfare be replaced by wholly private provision that would jeopardize the minority least able to care for themselves, liberal economists have refined policies that would permit choice between public and pl:ivate suppliers: minimum standards, contracting-out, tax refunds to encourage self-help, acting directly on low income, vouchers to enable everyone to pay for a choice...

...RET The A l t e r n a t i v e ; March, 1972 9 calm as ~'npioym~t soared above what e o ~ i v i s t s termed a "tolerable limit" of 3flO,~lO...

...I can suggest several possible reasons why the results of governmental programs continue to fall far short of their objectives while at the same time the economic role of the state continues to increase...

...It is hardly ~ t h ~ to ask tim ~ of Imbhc programs whether they wish to go on eujoying them willmut asllv~g ff they realiTe the price of these progran...

...The remarkable featm'e of the third survey, ~ by England-Grosse, is that it vividly demonstrates the extent of prevailing preferences for w~Ifmre policies quite different from what Conservative or Labour politicia~L~ are yet willing to concede...

...How could they be sure that spending ten billion pounds --not eight billion or twelve billion--a year on state welfare was what the public preferred...

...Oftentimes the /~esults of the program are not carefully examined, and its less obvious faults are not discovered...

...initiated coercion is a repugnant means to any end, even economic efficiency...

...ff people at Christnm-q lime were asked whether they enjoyed reeeivin_g presents, few woukl reply "'No- = Such attempts to measare preferences without prices have misled policymakers...

...Yesterdays" talk about tomorrow, and "'Tomorrows" talk about today and yesterday, until the reader is infected with time zone dysentery somewhere around page 80...

...Election results prove nothing, so long as all parties offer much the same welfare table d'hote...