A Nation of Moochers (28 page)

Chapter 18

WE’RE ALL FROM STARNESVILLE NOW

So what is fair? What do we owe one another and what right or claim do we have on our own wealth and that of others? What is the tipping point between a compassionate society and a nation of moochers?

More to the point: What does justice demand? Leaving aside the cost, isn’t it both more just and fair for a society to spread the wealth around, to redistribute it from the “privileged” to the “underprivileged” based on need?

In
Atlas Shrugged,
Ayn Rand offers an answer in the form of a morality play of her own devising, set in a town called Starnesville, Wisconsin.
¹

Rand’s story of the Twentieth Century Motor Company has a central place in the novel (spoiler alert). It marks the beginning of John Galt’s mission, while also describing in miniature what Galt stands against and why he felt compelled to stop the motor of the world. Rand tries to show the fundamental immorality behind the moral “ideal” of “from each according to his ability, to each according to his needs.” Far from being a moral ideal that lacked something of practicality, Rand insisted that a needs-based society is a truly hellacious idea, the stuff of nightmares that turns honest men into dishonest ones. In a brutal transvaluation of values, a horrible idea had somehow been elevated into a moral precept.

The “Family”

In the book, the owner of the Twentieth Century Motor Company dies and leaves the thriving enterprise to his three children, Eric, Gerald, and Ivy Starnes, who have very different ideas than their father on how to run the business. They call together all of the employees for a meeting at which they vote to adopt a plan that “everybody in the factory would work according to his ability, but would be paid according to his need.”
²
The narrator explains the reasons for the vote: Everyone assumed that they would have the edge over someone who was better off, forgetting all of those less able than they were, who would also get unearned benefits at their expense.

At first the whole group voted on needs. “It took us just one meeting to discover that we had become beggars—rotten, whining, sniveling beggars, all of us, because no man could claim his pay as his rightful earnings … so he had to beg in public for relief for his needs, like any lousy moocher.…”
³
The competition was no longer who could work hardest, or most creatively, or most productively: “it turned into a contest among six thousand panhandlers, each claiming that
his
need was worse than his brother’s.”
⁴

The employees were introduced to the Sucker Principle: “Your honesty was like a tool left at the mercy of the next man’s dishonesty. The honest ones paid, the dishonest collected.”
⁵

Needs turned out to be endless, while ability became a liability. The ablest men were required to work longer hours and nights—taxed—to support the ever growing neediness of others who had figured out how the system really worked.

A young man afire with ideas and ambition was foolish enough to come up with ideas to save thousands of man hours, but he found himself voted one of the “ablest” and “sentenced to night work.” The flow of ideas stopped: He had learned his lesson.

As Ivy Starnes later explains: “Rewards were based on need, and penalties on ability.”
⁶

The Starnes

In this morality play, the Starnes family is a triptych of villainy, with each of the siblings a different type of moocher advocacy.

Eric Starnes craves popularity, a glad hander who is obsessed with being liked. “He wanted to be loved, it seems,” says a former worker. “We couldn’t stand him.”
⁷

Gerald Starnes is in it for the glory and the cash; he milks the system, surrounding himself with magazine covers touting his benevolence, which he makes as conspicuous as his own greed, “flashing diamond cuff links the size of a nickel and shaking cigar ashes all over,” while claiming that the lushness of his lifestyle was not for himself, but for the benefit of the company and its noble plan. The employees hated him.
⁸

But the most dangerous was Ivy, the ideological purist, who illustrates how the enforcement of “fairness” morphs into the exercise of arbitrary power. Ivy is not motivated by popularity or celebrity, but rather by “goodness,” which translates into power.

Unlike her brothers, she didn’t care about material wealth. She dressed in “scuffed, flat-heeled shoes and shirtwaists—just to show how selfless she was.” Ivy was Director of Distribution. “She was the one who held us by the throat.”
⁹

The dramatic heart of the chapter is the story of an “old guy” who loved phonograph records. A childless widower, he had gone so far as to skip meals so he could afford to buy more classical music, his only real pleasure. But under the new regime, his solitary enjoyment was not considered a sufficient “need” to justify an allowance for what they deemed a “personal luxury.” At the same meeting a girl described as a “mean, ugly little eight-year-old” was voted gold braces for her buck teeth because the company psychologist worried that her self-esteen might be damaged unless her teeth were straightened. The man who loved music turned to drink and one night as he staggered down the street, he saw the girl with the gold braces and “swung his fist and knocked all her teeth out. Every one of them.”
¹⁰

Let’s cut Rand some slack and assume that she was not endorsing the music lover’s attack on the buck-toothed child; rather she used its violence to dramatize how characters were warped, distorted, and ultimately destroyed by the “plan.” Despite the unctuous good intentions, basing a society on “need” did not result in a kinder or gentler society.

The story of the collapse of Twentieth Century Motors has one final twist: a character named Eugene Lawson, the “banker with a heart,” whose bad loans cause his bank to fail and destroy the local Wisconsin economy. His first words in the book are: “I am not ashamed of it.”
¹¹
Despite the economic devastation his actions wrought, Lawson’s self-esteem is intact and he remains convinced of his moral superiority.

Lawson is a precursor of more modern bankers who handed out money based on “need,” rather than sound finances. His motives, he assures us, “were pure,” even though everything he touched turned to failure and ruin.
¹²
Oddly enough, not even Ayn Rand could envision a world in which the Eugene Lawsons would be bailed out by taxpayers.

A final irony: After crashing the bank and spreading economic devastation in his wake, Lawson ends up as a high-ranking government bureaucrat.

Chapter 19

WHAT’S FAIR?

What is the answer to the ideologies of redistribution?

Our answer has to start with the principle that individuals have a legitimate claim to their own incomes and that their wealth is not simply held at the sufferance of the political class.

Robert Nozick noted that any form of compulsory income redistribution is a serious matter, as it involves “the violation of people’s rights.” For Nozick, taxation on wages was “on a par with forced labor … Seizing the results of someone’s labor is equivalent to seizing hours from him and directing him to carry on various activities.” In effect, argued Nozick, if someone forces you to do uncompensated work they become a “part-owner of you.”

“The result,” he concluded, “is a shift from the classical liberal’s notion of self-ownership to the notion of (partial) property rights in
other
people.”
¹

Enforcing an arbitrary standard of equality or “fairness” on society or individuals cannot be maintained “without continuous interference with people’s lives.” To maintain a pattern of “fair” distribution of wealth (however that is defined by the political elites of the moment), Nozick wrote, means that “one must either continually interfere to stop people from transferring resources as they wish to, or continually (or periodically) interfere to take from some persons resources that others for some reason chose to transfer to them.”
²
In other words, people will continue to make decisions that will result in some people getting more and others less, regardless of how it affects the preferred “pattern” of income distribution.

In a free economy, for example, people will freely give money to the man who builds the most efficient engines, or to the basketball player (Nozick famously used the example of Wilt Chamberlain, but LeBron James or Kobe Bryant would work just as well) who displays the most talent and skill. Those individual choices may result in inequalities of wealth that can only be fixed by substituting government action for the choices freely made.
³

Nozick’s alternative to the standard “from each according to his ability to each according to his needs” was “From each as they choose, to each as they are chosen [in free, voluntary, and just exchanges].”
⁴

What Do We Deserve?

But do we really deserve the rewards we get? Or are we being greedy by insisting that we have a greater claim on our income than those who stake a claim to it on the basis of their “need”?

The notion that wealth is the result of effort rather than mere luck has been under intellectual siege for decades. Whether they are conscious of it or not, many advocates of income transfers draw their inspiration not from Marx, but from John Rawls, who argued that society should maximize the position of the least well off.

Despite his influence on modern liberal thinking, few candidates for elective office are likely to cite Rawls in their stump speeches. As William Voegeli notes, “People who call themselves Rawlsians, however, are always candidates for the faculty senate, not the US Senate.”
⁵
But thinkers like Rawls provide the intellectual architecture for much of modern progressivism; and even if they are unseen, they are like the poets whom Percy Bysshe Shelley declared to be the “unacknowledged legislators of the world.” Behind every welfare program of the last half century there is a Rawlsian, whether he knows it or not.

Rawls’s contribution is twofold: He provides the intellectual heft behind the argument that we should measure the virtue and justness of society by the extent of its redistribution of wealth. He also undermines the idea that rewards should be based on individual merit by suggesting that most of our advantages are matters of chance for which we deserve no credit. This includes our natural talents, which he regards as “morally arbitrary” and which should not influence the distribution of things like opportunities, income, wealth, and “the social bases of self-respect.”

Our natural qualities, argues Rawls, are decided “by the outcome of the natural lottery; and this outcome is arbitrary from a moral perspective. There is no more reason to permit the distribution of income and wealth to be settled by the distribution of natural assets than by historical and social fortune.”
⁶

What then about character? Some will make the most of their natural gifts, but some will squander them. Natural talent alone does not equal success, as many would-be celebrities demonstrate on a regular basis. And what about the effort expended to make the most of those natural gifts? Rawls dismisses both character and effort.

“The assertion that a man deserves the superior character that enables him to make the effort to cultivate his abilities is equally problematic,” writes Rawls, “for his character depends in large part upon fortunate family and social circumstances for which he can claim no credit.”
⁷
If he can claim no credit, it follows that he has at best a limited claim to the rewards.

Language has played a crucial role in advancing this notion that success and achievement are arbitrary and largely a result of chance and good luck. Consider all of the euphemisms that describe successful individuals as “fortunate,” “privileged,” or simply, “the haves.” The nomenclature is specifically designed to diminish the sense of deserving of those who are better off by blurring any recognition that their status might be a reward for achievement, innovation, risk taking, or hard work.

Admittedly the term “privileged” might fairly describe a third-generation heir or Hollywood celebrity frittering away their life on the island of Ibiza, but it distorts the reality of much of how wealth is created. Even the entrepreneur from a good family and other “morally arbitrary” natural advantages lives with the very real possibility that everything he has worked for will be lost; that the bank will call in his note, crushing his ability to make a payroll; or that a tax hike or new regulation will erase his narrow margin of profitability. In what sense, after all, is a small businessman who runs a start-up metal fabrication company “privileged”? By carrying the risk? The debt? By submitting his livelihood and family income to the vagaries of the marketplace and competition?

But this is precisely why the insistence that inequality is “morally arbitrary” is crucial to the politics of redistribution of income. There would be a very different tenor to the debate over “spreading around the wealth” if we substituted the words “achievers,” “doers,” and “makers,” for “the fortunate,” “the privileged,” and “the haves.” Language matters: It is not a coincidence that progressives have taken to calling the recipients of government aid the “less fortunate,” the “underprivileged,” and “victims.” Language shapes the debate when an advocate says that “we should raise taxes so the privileged can share their good fortune with the underprivileged.”