Thomas Sowell observed that if there were a contest to determine which word has done the most damage to people’s thinking it would be the word, “Fair.”  Initially I thought who could possibly object to fairness?  But then the thought occurred to me, Sowell was right—not because fairness is undesirable, but because almost no one agrees on what the word actually means.

Fairness is not an objective fact like the boiling point of water.  It’s a value judgment.  Everyone believes in fairness; what they disagree about is what fairness actually looks like in practice.

~ Karl Marx Believed in Fairness ~

During the Industrial Revolution, Karl Marx witnessed twelve- to sixteen-hour workdays, child labor, dangerous working conditions in factories, and virtually no legal protections for workers.  In such an environment, his argument that capitalism concentrated wealth while exploiting labor resonated with millions.  To Marx, fairness required a fundamentally different economic system in which wealth and the means of production were controlled collectively rather than privately.  Given those conditions, it’s not difficult to understand why so many found his ideas persuasive.

But that was then, and the world along with capitalism evolved.  Labor laws were enacted, child labor was abolished, unions emerged, productivity soared and living standards have risen dramatically.  As a result, capitalism has brought more prosperity and more freedom to more people than any economic system in history.  Yet socialism is once again gaining traction in America, particularly among younger generations.  Why?

I suspect many younger Americans don’t view socialism as an economic system.  I think they equate socialism with more affordable healthcare, attainable housing and stronger social safety nets.  In other words, they see socialism less as an economic philosophy and more of a moral vision.

But regardless of how socialism is perceived, every economic system must answer the fundamental questions.   How is wealth created?  Who creates it?  And how is it distributed?  Capitalism and socialism offer very different answers to those questions.  In their most basic form, capitalism relies on voluntary exchange and market prices, while socialism relies on political decision-making.

Every political and economic philosophy begins with a vision of a better society.  The question is not whether those visions are fair, but whether the proposed system can deliver what it promises. And the only society I am aware of that has satisfied everyone’s wants and needs was the Garden of Eden

Which brings us back to Thomas Sowell.

His point wasn’t that fairness is unimportant.  Quite the opposite.  His point was that before we can intelligently debate public policy, we must first agree on what fairness actually means.

The Founders were hardly indifferent to poverty or hardship; nonetheless, their concept of fairness was fundamentally different from  that of Karl Marx.  They believed government’s first responsibility was to protect liberty, private property, and equality before the law.  The Founders understood that people would differ in talent, ambition, and effort.  And with human nature being what it is, their objective was not equal economic outcomes, an impossible goal that’s never existed at any time or at any place in world history, but rather, equal rights and equal opportunity under the law.

Democratic socialism begins from a very different premise; that that reducing economic inequality requires government action.  Meanwhile both systems operate under the same economic reality – that before wealth can be redistributed, it must first be created.  And that’s the question advocates of socialism—’democratic’ or otherwise have never answered satisfactorily.  And let’s not be fooled by the specious and naïve example of Scandinavia – nations with market economies and taxation at levels Americans would never accept voluntarily.   As Thomas Sowell famously observed, “There are no solutions, only trade-offs.”

History reveals that capitalism produces extraordinary wealth, but it also produces unequal outcomes.  Democratic socialism promises greater dispersion of wealth but has no record of creating it in the first place.  Look no further than economic struggles in Eastern Europe from the end of World War II until the break-up of the Soviet empire.  History does not lie!

Everyone wants fairness.  But whose definition of fairness should guide public policy, and will those policies achieve the results they promise?  So, before the discussion about what’s fair and what’s not begins, we must first ask:  Fairness according to whom?

Quote of the Day: “The inherent vice of capitalism is the unequal sharing of blessings.  The inherent virtue of socialism is the equal sharing of miseries.” — Winston Churchill