Wealth and poverty in the liberal tradition.

Author:Lomasky, Loren
 
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Poverty comes naturally to human beings. We enter the world with nothing and leave with less. During the interim, labor affords whatever subsistence or better life we enjoy. A useful way to appraise the human condition, then, is in terms of the means we have learned to employ for edging away from the natural condition of want. During the seventeenth century, an idea for social organization emerged in which government is sharply limited in its legitimate functions. Primary among these functions is the protection and preservation of individuals' rights, where these rights are understood as preeminently liberties: rights to be let alone. The idea described here is the nascent theory of liberalism. One effect of the subsequent implementation of this principle of social organization was unprecedented accumulation of wealth during the eighteenth, nineteenth, and twentieth centuries. Reflection on strategies for escape from poverty into wealth has been, from its beginning, an integral theme of liberal political philosophy.

The first step human beings undertake to move from the natural condition of extreme want is acquisition. It can be as simple a procedure as picking a berry from a bush and popping it into one's mouth. Simple, however, does not often suffice. Providence may be generous with regard to the natural bounty it bestows on human beings, but most of that largesse is not provided in ready-to-consume dollops. Therefore, a second step is transformation. The seeds one collects may provide some little bit of nourishment in their original state, but if planted, cultivated, and harvested, they afford far more value. A third step is preservation. If the painstakingly produced crop is ravaged either by locusts or by locals, then the labor invested goes for naught.

Each stage of wealth generation depends for its success on terms of cooperation with willing others. Acquisition is simplest and most open to solitary efforts, but even here cooperation puts within one's reach goods that otherwise would be inaccessible. The gain in accessibility is literally so when one's companion offers a boost to apples on branches above one's reach, figuratively so when the companion provides information concerning where to find those apples. Transformation is yet more cooperation intensive. Jacks-of-all-trades are rarely masters of even one, and therefore production processes of more than a very small number of steps will involve inputs from several and perhaps even hundreds of participants. Preservation is most cooperation intensive of all. I may need the active cooperation of only a small number of coworkers to produce a good, but once the good is generated, it is vulnerable to usurpation by an indefinite number of potential predators. Claim of a property holding is a claim against the world, and thus the world's acquiescence, either active or passive, is requisite for the property's security.

All the early modern political thinkers considered in one way or another these stages of wealth generation. An account that does not begin with Thomas Hobbes and then work its way forward through the theories of Spinoza, Montesquieu, Rousseau, Hume, and Mill is incomplete. Our aim in this article, however, is not completeness, but rather coherence and concision, so we focus on the seminal thought of John Locke and Adam Smith, with a passing nod to Immanuel Kant. We see this approach not as an exercise in antiquarian retrieval, but rather as mining a tradition of thought vitally relevant to a world in which billions of people are endeavoring to escape destitution. The controlling idea is that some institutional arrangements are more conducive to economic development than are others. Liberal political philosophy suggests a simple recipe: establish and protect private-property rights; honor contractual agreements; and require mutual consent for transfers of property. Smith refers to this formula as the system of natural liberty. Its great virtue is that it allows people to coordinate their affairs with each other in ways that tend to their mutual betterment.

What Is Poverty?

Contemporary definitions of poverty divide into two genuses: those that invoke an absolute measure and those that are relative. (1) For the classical-liberal tradition, the former is theoretically salient. Poverty is about not having enough rather than about having less. In the premodern world, the vast majority of human beings, even in the most advanced countries of Europe, led lives only marginally removed from bare subsistence. Onset of illness or demise of a farm animal might put a family's sustenance in jeopardy; a bad harvest or period of tight money might do likewise for entire communities. Wealth was distributed in the form of a pyramid, with only the small number at the top comfortably removed from want. Both then and now, to be poor is to be on the edge of exigence, to be in serious peril of being unable to avail oneself of basic necessities, such as adequate nutrition, shelter, fuel, means to rear one's children, and so on. This roughly demarcated realm stretches from abject to genteel poverty. When inadequately clothed persons shiver and their empty bellies growl, no definitional fine points are required to form a lively conception of the features of poverty. The problem at hand under such conditions is to save individuals from falling over the edge of exigency, not to satisfy some arcane criteria of distributive justice (as in, for example, John Rawls's difference principle).

Changing circumstances alter the urgency of social problems. Wealthy societies can afford to attend to dimensions of distributional inequality to an extent that less wealthy ones cannot. (2) Liberals disagree about whether inequality in wealth or income as such is invidious; this disagreement is one of the key divides between classical and egalitarian liberalism. Because poverty is not a natural kind, its essence is not a clear-cut fact; we choose how to use the term. But because being on the verge of destitution differs from being, say, more than one standard deviation below the median income earner, clarity requires having distinct terms for the two kinds of circumstances. Poor is a perfectly good term for the former, unequal for the latter. We use these terms. If others choose to employ the expression relative poverty, we will dutifully point out the potential for troublesome ambiguity, but otherwise we will not fight for our preferred usage.

Acquisition, Transformation, and Preservation

"The world is so full of a number of things, I'm sure we should all be as happy as kings." So spoke Robert Louis Stevenson, and, admittedly, he had a point. The happiness would be distinctly muted, however, if that cornucopia of things had to remain in their natural state, unused by human beings. Such unavailability would be a disgrace, especially given the conception of a beneficent deity who supplies those things primarily for the benefit of human beings. It is fanciful to suppose that all human beings can agree on anything, even the necessary preconditions for their own survival. Therefore, argues Locke, although creation's bounty is dispensed to mankind in common, individuals must be entitled severally to appropriate from nature, else the divine intention to nurture human life would be unfulfilled. (3) Thus, the first step toward escaping extreme want is acquisition. It is not, however, an unproblematic step. That which is removed from the commons by one person thereby becomes unavailable to all other persons. Original acquisition raises two questions. First, by what means is an item legitimately removed from the commons and made a piece of personal property? Second, what constraints, if any, protect the interests of those who are thereby deprived of the possibility of acquiring the item in question for themselves?

The answer to the first question is labor. It is evident that one's body is one's own by right (subject to God's overlordship of all creation), and thus one's labor is similarly one's own. To mix that labor with things in the world distinctively connects those items to one's person. It is as if they have become an extension of the self. Among all of humanity, no one else has a relationship to these items as normatively close, and that distinction solves the problem of who is entitled to enjoy the status of owner. (4) In Locke's view, others have no legitimate complaint of dispossession because the extent of appropriation is constrained by the proviso that enough and as good be available for them. (5) Under these terms, each individual is made better off by his liberty to appropriate, and no one is set back by others' appropriations. Private property in external objects is a theorem of natural reason.

Locke-type justifications of original acquisition have been controversial from the beginning. Jean-Jacques Rousseau advances in the Second Discourse an early influential critique. It is important to understand, however, that the acquisition problem is altogether preliminary to the main event. No very plush existence can be had by extracting berries and other such goods from the state of nature. God may have been bountiful to man, but since the expulsion from Eden that bounty has consisted primarily of raw materials rather than finished products. If people are to ascend from primitive rusticity to a more commodious existence, they need to implement technologies of transforming the resources in their environment so as to enhance value. The first and most important transformative technology was agriculture. When private property is extended from chattels to land, opportunities to invest profitably in crop-producing potential are magnified many times over. Agricultural populations are more numerous and much wealthier than hunter-gatherers. That wealth in turn affords a surplus that can be extended to other forms of production and concomitant development of urban areas.

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