Hi there liberal rule-of-law fetishists!
Now that I’ve got your attention, I’d like to mention something that’s been bothering me. This idea that we all order our affairs under a system of predictable rules sounds very nice, but I do wonder whether it’s compatible with some of the other things that you seem to be signed up for. Some of you, I know, are worried about this so-called 1 per cent, and even about the 1 per cent of the 1 per cent: the people who own lots of stuff. Not only do they own lots of stuff, but they own the kind of stuff that is useful if you want to own even more stuff. That’s how it goes. And, of course, they also have the means to bring about a favourable “regulatory environment”, so that they get to hold onto that stuff.
Now I suppose you want to do something about that? Yes? One option would be to let them hang onto all their existing assets – after all, they got them justly (or at least non-criminally) according to the rules of the system they themselves helped to formulate – but to introduce a new system of rules (call it a “basic structure” if you like) that works to the greatest benefit of the least advantaged. Assume you have the knowledge to design it with the distributive effects you want (big assumption that!). Let that system grind away for long enough – a few generations perhaps – and you’ll have shifted things a little bit in the right direction. (Assuming, that is, that the 1 per cent don’t use their residual wealth and influence to throw you off-track as soon as you hit the first bump.)
I think you can see where I’m going by now. If you really want a shift in the distribution of wealth and income, if you really really want it, then realistically you’re going to have to use state power to do a bit of ex post redistribution. You’re going to have to take stuff from some people and give it to others. Doesn’t necessarily have to be that total Marxian expropriation of the expropriators: a comprehensive programme of debt cancellation would fit the bill. Life is about making choices: and you’re going to have to choose. Is it outrageous to dispossess someone of the wealth they acquired under the rules of the game; or are you going to say that substantive fairness sometimes matters more?
Now I know there are some wrinkles there. What about predictability? What about incentives? Sure. (Of course the predictability of stable property rules is a bit overstated: all those people who got their houses repossessed when the economy went bad didn’t see that coming!) You might have to duck and weave. You might have to convince property owners that you’ll only go so far and no further. But don’t kid yourselves that you can do the redistribution you want and treat the rule of law as absolute. If robbing the rich appals you, become a libertarian instead.
(UPDATE: Well I’ve clearly managed to confuse a bunch of people with this post. Probably a consequence of trying to make a serious point in a knockabout style. I had in mind not any old garden-variety idea of the rule of law but something a bit more specific, namely that society ought to be run according to predictable rules that provide individuals with certainty that their efforts won’t be nullified by state action, a view associated with Hayek but endorsed by Rawlsians. So mea culpa for that.)