The Price of Fairness
President Obama is big on fairness. “Fair” or some variant thereof was mentioned eight times in his State of the Union speech, more than “health care” (twice), his signature legislative accomplishment, or “spending” (three times), the nation’s most pressing problem.
Mr. Obama claims, in fact, that the issue of fairness is the “defining issue of our time.” The president gives us a stark, if fallacious, choice:
“No challenge is more urgent. No debate is more important. We can either settle for a country where a shrinking number of people do really well, while a growing number of Americans barely get by. Or we can restore an economy where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same set of rules.”
Mr. Obama then laid out his prescription for creating this “fair” society - more government. New bureaucracies (a “trade enforcement unit”), more training programs, more infrastructure stimulus spending, more regulations on the financial and energy sectors and, of course, more taxes: “[W]e need to change our tax code so that people like me, and an awful lot of members of Congress, pay our fair share of taxes,” the president righteously intoned. Of course, the top 10 percent of earners already pay 70 percent of federal income taxes, a sum many people might conclude is “more than their fair share,” but never mind.
This effort to impose fairness on society by all-knowing, all-caring government functionaries has been tried many times. It never ends well, and comedian Louis C.K. tells a story that illustrates why. As Louis tells the story in one of his stand-up specials (I paraphrase here from memory), his daughter once accidentally broke one of her toys and then demanded that Louis break her sibling’s toy “to make it fair.”
Wow. From the mouths of babes, a perfect example of how the impulse to “fairness” - seemingly so benign in theory - in practice often leads to disaster.
Nature is not fair. It dispenses talent, intellect and luck unequally among the people of the world. As a result, some will always end up with more than others. When government sets out to impose “fairness” on society, it is therefore faced with a dilemma. It is impossible to make some people smarter, luckier and more talented. It is equally impossible to stop those blessings from being bestowed in the first place. The only recourse for government, then, is to destroy or confiscate the material rewards that so often accrue as a consequence of such qualities. Fairness to all, then, is really punishment for many.
This is the reason political systems that have as their explicit charter the imposition of fairness often descend into totalitarianism - total government power is the only way to enforce total equality. In such a state, misery and material want will be the norm; everyone will be equally unhappy, like Louis C.K.’s two children, each with a broken toy.
We should keep all of this in mind when we hear politicians like Mr. Obama lament the “inequality” in our society, and we should always look askance at their solutions to this alleged problem. We should remember that material equality does not necessarily mean prosperity or stability. As Charles Lane noted recently in The Washington Post: “Western Europe’s recent history suggests that flat income distribution accompanies flat economic growth. Which European country recorded the biggest decrease in inequality between 1985 and 2008? That would be Greece.”
And we all know how well that’s working out.