Georgia’s law requires private and government employers to use E-Verify, a federal program, to ensure that workers are eligible to work in the United States. The law also increased the penalties for using fake documents to obtain jobs; offenders now face up to 15 years in prison and $250,000 in fines. Moreover, the law makes it a criminal offense to intentionally transport or harbor illegal immigrants, authorizes local and state law enforcement officials to arrest illegal immigrants and house them in state and federal jails, and requires documentation verifying legal status before people can apply for food stamps or government housing.

Alabama’s law goes even further than Georgia’s. It not only clamps down on illegal immigration, it also prevents illegal immigrants already in the state from establishing themselves. The law requires public schools to verify students’ residency status with birth certificates, bans illegal immigrants from state colleges, and outlaws transporting, harboring, employing, or renting property to undocumented immigrants. The bill also requires law enforcement officers to detain and investigate anyone they reasonably suspect is an illegal.

Opposition to the new laws emerged immediately in both states. In Alabama, churches and charities thought the wording so stringent that they worried about being implicated simply for ministering to illegal immigrants. Episcopal, Methodist, and Catholic church officials in Alabama sued Governor Robert Bentley and Attorney General Luther Strange. The American Civil Liberties Union (ACLU) of Alabama and Georgia, as well as other civil liberties advocacy groups, like the Southern Poverty Law Center, also brought forward lawsuits because the new law will likely result in racial profiling.

While the specific methods of implementation for Alabama’s and Georgia’s immigration laws could be altered in the hope of minimizing their social consequences by, for example, randomly checking people for citizenship instead of profiling people who look different or out of place, the negative economic results cannot be avoided or minimized unless the laws are ignored. New business paperwork, law enforcement, and incarceration will impose steep costs. All industries will suffer some negative effects, and the fortunes of a number of industries, such as agriculture, restaurants, landscaping, catfish and poultry processing, and construction, will be seriously compromised. Jeffrey Passel estimated in a 2006 study that across the nation, illegal immigrants make up 24 percent of the agricultural workforce, 17 percent of the cleaning industry workforce, 14 percent of the construction workforce, 12 percent of the food preparation workforce, and 9 percent of the production workforce.

The effects of the new laws are already being felt throughout the agricultural industry in both states. Illegal immigrants are now so afraid of imprisonment and deportation that they have stopped supplying their labor during harvest seasons. And it’s not just illegals who are fleeing the state. Green-card carrying immigrants also quit their jobs in protest and are leaving Alabama.

Wasted Crops

Alabama Live reports that central Alabama farmers requested an emergency suspension of the law because millions of dollars of crops were at risk of not being harvested due to labor shortages. In the Wall Street Journal, Alabama Deputy Commissioner for Agriculture and Industry Brett Hall was quoted saying: “We have a big problem on our hands. . . . [F]armers and business people could go under.” Economists say the law will hurt Alabama’s economy, but politicians such as State Sen. Scott Beason (a Republican) called their arguments “absolutely, positively wrong”. He also called the Alabama law “the biggest jobs program for Alabamians that has ever been passed.”

Meanwhile Jay Bookman of the Atlanta Journal-Constitution reports that Georgia’s law has already caused a severe enough labor shortage that farmers are at risk of leaving up to $300 million of crops rotting in their fields.

The construction industry, which has relied on immigrants in recent years, is also being hit hard. Despite the remaining slack from the housing crisis, delays in Alabama and Georgia are common. Nowhere is the story more tragic than in Tuscaloosa, Alabama, where residents and businesses downtown were hit by a tornado last April. Cheap, efficient labor was desperately needed. Yet reconstruction in Tuscaloosa has been slow and has lagged behind Joplin, Missouri, which was hit with a much more severe tornado a month later. While some of the delays in Tuscaloosa can be blamed on red tape, the harsh immigration law certainly has not helped matters.

Unambiguous Benefits

Despite politicians’ ill-informed rhetoric and pro-law rallies by Tea Party groups, the economics of the issue remain unambiguous: Immigration, whether legal or illegal, is a net general benefit for the people of a state or country. The argument is an easy extension of David Ricardo’s argument for free trade; blocking immigration hampers the free operation of an economy in much the same way that blocking trade does. It prevents resources, including labor, from being reallocated to those industries and locations where consumers most urgently want them.

The evidence shows that immigration does not take away jobs or even decrease wages for native workers. Julian Simon in a 1995 study found that immigration does not increase unemployment for U.S. citizens, even among minority and low-skilled workers. George Borjas and Lawrence Katz, in a study published in 2007, found that the only group adversely affected by immigration in the United States was high school dropouts, who saw a long-run 4.8 percent reduction in wages.

Borjas and Katz assumed that immigrant and native workforces do the same work, an assumption that does not bear out empirically. Even with that assumption, however, Borjas in 2008 estimated the net economic gain to native workers from immigration to be around $22 billion annually. When Gianmarco I. P. Ottavanio and Giovanni Peri corrected for this assumption in a 2006 study, they found immigration actually increased natives’ wages in the short and long runs because immigrants complement the native workforce.

More Workers, More Prosperity

As coauthor Luke points out from his farm experience, Americans usually don’t want the jobs that immigrants are willing to take.

The number of jobs in an economy is unlimited because our wants are unlimited. The more people working, the further down our list of wants we can get. Moreover, the more people working, the more potential customers—and hence business opportunities—we have. Immigrants buy or rent houses, purchase food and goods, and dine at restaurants. This is why the United States did not suffer mass unemployment as our population drastically increased over the last few decades, and why there wasn’t a jump in unemployment when women joined the labor force. (See graph.)

Another common argument for the Alabama and Georgia laws is that immigrants will flood U.S. cities beyond capacity in search of higher living standards. If people migrated en masse to those areas with the highest wage rates, one may wonder why all U.S. citizens don’t flood Malibu, California. The reason is that real estate values adjust upward to act as a natural brake on migration. In addition, while there is much need for immigrant labor in the United States, workers will come here only as long as the expected wage exceeds their domestic wages plus the costs of relocating. As more immigrants resettle, the relevant wage will drop, decreasing their main incentive for coming in the first place.

The Welfare Argument

A third justification for legal restrictions is to prevent immigrants from living off government programs. Anyone concerned about this should ask why the Alabama, Arizona, and Georgia laws focus almost all enforcement efforts on preventing immigrants from working. Although immigration laws have provided strong incentives for immigrants not to work, Simon’s 1995 study calculated that on net they paid more into government programs than they took out.

The justifications for Alabama’s and Georgia’s laws fail to pass the test of basic economics. Not only do these laws not bode well for the economy, they also tar the civil rights images of two states that historically have suffered poor reputations in that department. In a country founded on open immigration and the basic freedom of human association and commerce, laws of this nature are a travesty.

I’m not convinced.

To be sure, it’s easy to see why an uncritical observer might think people like Krugman and Robinson are right. We can certainly look back on centuries—millennia, even—during which poor people have gotten the short end of the stick, in which poverty has coexisted, heart-breakingly, with great wealth. And perhaps those memories make it tempting for some people to buy the civics-class story that the only thing standing between us and a world full of Dickensian nightmares is activist government.

But that would be a mistake. The poverty and exclusion evident throughout history, and still very much a part of today’s world, can frequently be traced precisely to the unjust acts of government officials and their cronies. When people are denied ownership of land they’ve homesteaded with their labor so feudal overlords can turn them into serfs, the culprit isn’t freedom, or the market—it’s government support for the wealthy and well-connected. Ditto for cases in which people are denied the right to work by laws, like England’s old Acts of Settlement, that limit their ability to travel in search of new opportunities.

More generally: There’s no reason to trust activist government because the people in charge can be expected, time and again, to back those with power and influence over those without. Being poor doesn’t make you a favored object of government attention—instead, it means you’re likely to be used and abused. Politicians will claim to be defending your interests when they’re really promoting their own. They’ll continue to enact rules that limit your ability to support yourself and make it costly for you to provide decent shelter and clothing for yourself and your family. And law enforcement agencies will subject you to violence—whether they’re enforcing drug laws or immigration restrictions, or ensuring that you conform to zoning regulations and local codes designed to be easy for middle-class people to follow while making your life costly and difficult.

Government action in contemporary society makes and keeps people poor. Licensing laws, zoning regulations, and similar restrictions make it hard for poor people to enter particular job markets and to operate businesses out of their homes. Without these kinds of government regulations in place, people would be less likely to be poor.

Poverty is a systemic problem. It’s a product of lots of different, overlapping, mutually reinforcing factors. Getting rid of just one abuse or inequity here or there might well leave many people poor. But systemic change, change that addresses all the different factors that make poverty a persistent, ugly feature of our lives, can make a profound difference. And the kind of systemic change we need is change that eliminates State-secured privileges and State-imposed liabilities, not another State-created bureaucracy designed to ameliorate problems the State itself has created.

State Poverty

Government’s role in making and keeping people poor is just one of the factors that make poverty endemic and make it hard to survive while poor.

For instance: Governments don’t treat recipients of the antipoverty aid they disburse especially well. It’s important to avoid comparing idealized State practice with imaginary worst-case practice in the government’s absence. If we focus on actual government practice we find that poor people are not served particularly well by the State, which routinely intrudes into the lives of recipients of assistance, violating their privacy and seeking to regulate their behavior. People pay a high price for aid from the State. Government aid programs come with hidden price tags.

And governments increase the number of poor people in part precisely through some antipoverty programs, which can create perverse incentives both for people to remain poor enough to qualify for government funds and for bureaucrats to keep people poor in order to retain their own jobs.

Governments raise the cost of being poor. Building codes and zoning regulations raise the cost of housing and so make it harder for people to find inexpensive homes. Some people are forced to live without permanent housing at all, while others must spend much larger fractions of their incomes on housing than they otherwise would. As for food, that’s also more expensive thanks to agricultural tariffs and import quotas. In the absence of government policies that make meeting their basic needs unnecessarily expensive, poor people would have more disposable income and would be more economically secure.

More than that, though, governments actively take money from poor people. Many poor people pay more in taxes than they get back in services under the State’s rule. These people would have more resources on net in the absence of the State’s demand for tax money. In addition many people are poor, or poorer, today because the State has actively stolen land and other resources from them or their ancestors or has sanctioned such thefts committed by the wealthy and well-connected. (Think eminent domain among other methods.) Historically the existence of a peasant class and of a class of displaced urban workers willing to accept employment on dismal terms is inexplicable without reference to State violence or State tolerance for or endorsement of violence by the wealthy and well-connected.

The government raises the cost of obtaining key goods and services. The State does a range of things (notably requiring professional licenses, hospital accreditation, and prescriptions and enforcing drug and medical device patents, and other restraints on trade) to make particular services such as health care especially expensive.

All these different factors fit together, each one making people’s conditions worse than they’d otherwise be and making the effects of the other factors more severe. People often start out with less money because of large-scale past injustices. They have less money now because of government limitations on the kind of work they can do and where they can do it. Their ability to provide decent lives for themselves and their families is further limited because the government raises the cost of living, and government regulation of the economy drives down the overall level of productivity even further in ways that obviously hurt the poor the most.

In sum the government plays a crucial role in creating and perpetuating poverty—and that’s really the most important thing to recognize. But of course that doesn’t mean that, absent the government’s abuses, people wouldn’t have accidents, confront disasters, and make unwise choices. With costs of living reduced, as they would be if the government completely left the economy alone, people would find it easier to deal with these challenges. They’d still need one another’s help, but those who think there’d be no way to get this kind of help except through tax-funded government agencies are mistaken.

The existence of State antipoverty programs crowds out alternatives and reduces the effectiveness of those that remain. It’s easy to view these alternatives as essentially ineffectual and anemic. But a crucial reason they’re not more vibrant is that State action commandeers money and attention that might otherwise be directed to these alternatives, creating the illusion that in the government’s absence, they couldn’t be much more effective.

Support for poverty relief doesn’t just come from tax funds now. People give money to charitable causes over and above their tax bills today, despite the huge sums the State claims. There’s no reason to think they would not do so if the government absented itself from economic life. It is naive to suppose that the wealthy and powerful are opposed to State funding for services to the poor at present; the poor have far less clout than the wealthy and powerful, and yet the State provides minimal services for poor people. Why suppose that wealthy and well-connected people willing to see the State spend their tax money to support services for the poor would be dramatically less willing to contribute to the support of such services if the government weren’t involved? (Why do people give money to good causes, including voluntary programs that help the poor? Why do wealthy and well-connected people endorse State spending on programs that provide services to poor people? Presumably for a combination of reasons, including, in no particular order, compassion, social norms, the desire for good reputations, the desire to avoid bad reputations, and the desire to avoid social disorder. All of these reasons would be operative in a free society.)

Mutual Aid

In addition, mutual-aid networks could provide many of the services well-intentioned statists want the government to offer. Societies in which people pooled risk and provided pensions, health care, and other services functioned effectively before the rise of State social services, and there’s no reason they couldn’t do so again in the government’s absence—and, indeed, wouldn’t function much better given that people would have access to more resources and the State would not be regulating them out of existence.

Both charity and mutual aid are more viable than government-run antipoverty programs, more able to help poor people, precisely because those programs have high administrative costs. (Thanks to Tom Woods for this point.) Programs supported freely by people in the government’s absence would not feature such high costs. Because donors could choose among multiple programs, there would be persistent pressure for administrative costs to be reduced.

In addition, social norms could ensure predictable, consistent support of community-wide aid programs without taxation. General acceptance of a social norm entailing regular contributions to a community income support fund, or leaving the edges of fields available (as in Leviticus) for gleaning, could ensure that poor people who needed it could rely on community assistance.

State-managed antipoverty programs draw on tax resources taken unwillingly from people. People work less energetically and enthusiastically when they know that some of what they produce will in effect be taken from them at gunpoint. Thus taking resources from people through taxation to fund antipoverty programs can function as a drag on the economy. By contrast, when people give willingly to support antipoverty efforts, their own objectives are not being thwarted; if they wish to support these efforts, they will be willing to work hard to do so. With the government out of the economy, people can work enthusiastically to earn wealth and foster overall economic productivity even as they support significant antipoverty efforts.

Advocates of government antipoverty programs sometimes worry that the absence of the State would mean a return to the misery and squalor typical of many people’s lives in the eighteenth and nineteenth centuries; they too often attribute these conditions to the absence of State regulation and antipoverty programs. But it’s important to emphasize that these conditions reflected the much lower overall levels of societal wealth. People weren’t poor because of the absence of State regulations and antipoverty programs; they were poor in part because there was very little wealth overall and thus less for those who wanted to help the poor. (Thanks to Tom Woods again on this score.) And of course the misery and squalor weren’t entirely natural or inevitable: Some resulted from persistent—and remediable—injustice on the part of elites and their political cronies.

Rectification

It’s also important to emphasize that getting the State out of the economy doesn’t—can’t—mean simply stopping State intervention. It also has to mean providing rectification for State-committed and State-sanctioned wrongdoing. Politically privileged elites have stolen land and resources from poor, working-class, and middle-class people—directly and by securing tax-funded subsidies and government contracts. There’s no way to understand the distribution of wealth and power in contemporary society without acknowledging this history of theft and violence. To the extent that it’s possible, past injustice ought to be remedied. For instance, people ought to be able to homestead land engrossed by the State, especially land allocated arbitrarily to the State’s cronies. If land and other resources were made available for homesteading or returned to those from whom they were taken, the poverty of the State’s victims could be significantly reduced.

Structural changes would also make poverty less likely in the absence of government intervention. Rules that made it harder for absentee landlords to sit on undeveloped, uncultivated land could open up this land for homesteading by people with limited resources and thus provide them an avenue to greater economic security. Eliminating subsidies and legal privileges for hierarchical corporations would increase the likelihood that people could enjoy the job security associated with working for themselves (with less risk than accompanies being an independent contractor in a less healthy economy) or in partnerships or cooperatives and that, when they did work for others, they could bargain successfully for better compensation.

Libertarianism isn’t a philosophy of atomism. Libertarians have every reason to value interdependence and shared responsibility. Obviously, that’s true of the interdependence fostered by the market order. But it’s also true of the interdependence of friends and family members and strangers who work together to help one another meet life’s challenges. People working together don’t need the government’s help to deal with poverty. The government often makes the problem worse, and it’s definitely not needed to remedy deprivation and economic insecurity.

Poverty has multiple causes—but many of those causes interact with and reinforce one another. Many are created by government action. If we get the government out of the economy and see to it that past injustices committed or sanctioned by the government are remedied, we can effectively meet the challenge of poverty together.

There is very little either complicated or interesting about poverty. Poverty has been man’s condition throughout his history. The causes of poverty are quite simple and straightforward. Generally, individual people or entire nations are poor for one or more of the following reasons: (1) they cannot produce many things highly valued by others; (2) they can produce things valued by others but they are prevented from doing so; or (3) they volunteer to be poor.

The true mystery is why there is any affluence at all. That is, how did a tiny proportion of man’s population (mostly in the West) for only a tiny part of man’s history (mainly in the nineteenth, twentieth, and twenty-first centuries) manage to escape the fate of their fellow men?

Sometimes, in reference to the United States, people point to its rich endowment of natural resources. This explanation is unsatisfactory. Were abundant natural resources the cause of affluence, Africa and South America would stand out as the richest continents, instead of being home to some of the world’s most miserably poor people. By contrast, that explanation would suggest that resource-poor countries like Japan, Hong Kong, and Great Britain should be poor instead of ranking among the world’s richest places.

Another unsatisfactory explanation of poverty is colonialism. This argument suggests that third-world poverty is a legacy of having been colonized, exploited, and robbed of its riches by the mother country. But it turns out that countries like the United States, Canada, Australia, and New Zealand were colonies; yet they are among the world’s richest countries. Hong Kong was a colony of Great Britain until 1997, when China regained sovereignty, but it managed to become the second richest political jurisdiction in the Far East. On the other hand, Ethiopia, Liberia, Tibet, and Nepal were never colonies, or were so for only a few years, and they rank among the world’s poorest and most backward countries.

Despite the many justified criticisms of colonialism and, I might add, multinationals, both served as a means of transferring Western technology and institutions, bringing backward peoples into greater contact with a more-developed Western world. A tragic fact is that many African countries have suffered significant decline since independence. In many of those countries the average citizen can boast that he ate more regularly and enjoyed greater human-rights protections under colonial rule. The colonial powers never perpetrated the unspeakable human rights abuses, including genocide, that we have seen in post-independence Burundi, Uganda, Zimbabwe, Sudan, Central African Empire, Somalia, and elsewhere.

Any economist who suggests he has a complete answer to the causes of affluence should be viewed with suspicion. We do not know fully what makes some societies richer than others. However, we can make guesses based on correlations. Start out by ranking countries according to their economic systems. Conceptually we could arrange them from more capitalistic (having a larger free-market sector) to more communistic (with extensive State intervention and planning). Then consult Amnesty International’s ranking of countries according to human-rights abuses. Then get World Bank income statistics and rank countries from highest to lowest per capita income.

Compiling the three lists, one would observe a very strong, though imperfect, correlation: Those countries with greater economic liberty tend also to have stronger protections of human rights. And their people are wealthier. That finding is not a coincidence, so let us speculate on the relationship.

Rights and Prosperity

One way to gauge human-rights protection is to ask to what extent the State protects voluntary exchange and private property. These signify the rights to acquire, keep, and dispose of property in any fashion so long as one does not violate the rights of others. The difference between private property rights and collectively held rights is not simply philosophical. Private property produces systemically different incentives and results from collective property.

Since collectivists often trivialize private property rights, they are worth elaborating. When property rights are held privately the costs and benefits of decisions are concentrated in the individual decision maker; with collectively held property rights they are dispersed across society. For example, private property forces homeowners to take into account the effect of their current decisions on the future value of their homes, because that value depends, among other things, on how long the property will provide housing services. Thus privately owned property holds one’s personal wealth hostage to doing the socially responsible thing—economizing scarce resources.

Contrast these incentives to those of collective ownership. When the government owns the house, the individual has less incentive to take care of it simply because he does not capture the full benefit of his efforts. It is dispersed across society instead. The costs of neglecting the house are similarly spread. You do not have to be a rocket scientist to predict that under these circumstances, less care will be taken.

Nor is nominal collective ownership the only force that weakens social responsibility. When government taxes property, it changes the ownership characteristics. If government were to impose a 75 percent tax on a person selling his house, it would reduce his incentive to use the house wisely.

This argument applies to all activities, including work and investment. Whatever lowers the return from or raises the cost of an investment reduces incentives to make that investment in the first place. This applies to investment in human as well as physical capital—that is, those activities that raise the productive capacity of individuals.

To a significant degree the wealth of nations is embodied in their people. The starkest example of this is the experience of the Germans and Japanese after World War II. During the war, Allied bombing missions destroyed nearly the entire physical stock of each country. What was not destroyed was the human capital of the people: their skills and education. In two or three decades, both countries reemerged as formidable economic forces. The Marshall Plan and other U.S. subsidies to Europe and Japan cannot begin to explain their recovery.

Proper identification of the causes of poverty is critical. If it is seen, as is too often the case, as a result of exploitation, the policy recommendation that naturally emerges is income redistribution—that is, government confiscation of some people’s “ill-gotten” gains and “restoration” to their “rightful” owners. This is the politics of envy: bigger and bigger welfare programs domestically and bigger and bigger foreign-aid programs internationally.

If poverty is correctly seen as a result of the unwise government intervention and lack of productive capacity, more effective policy recommendations emerge.

The controversy surrounding immigration is not limited to Arizona, of course; many states have wrestled with the issue. But something about this is confusing: Almost all Americans are the descendents of immigrants, and the inscription on the base of the Statue of Liberty seems to give an explicit welcome message to immigrants. So why should anyone be concerned about the “problem” of immigration in the first place? What underlies the anxiety? I am not a psychiatrist, of course, but from reading both print and web discussions I think there are several reasons, each of which I believe is unfounded, though I will make a concession for one. In many cases, the anxiety and self-contradiction are due to conceptual confusion about rights and economics.

One of the concerns I see expressed frequently is that immigrants will come here and go on welfare. This argument has traction even among people who would otherwise be sympathetic to a libertarian open-borders position: It’s bad enough we have to subsidize people who don’t work, so why increase the number of people we subsidize?

This argument grants the idea that open borders would be fine as long as everyone were working. People who make this argument recognize that immigrants in the past came to the “land of opportunity” to make a better life for themselves. Proponents of immigration like to point to the Ellis Island experience, in which people came to America from the old world, found jobs, and by the third generation were solidly upper middle class. Here opponents of immigration will note that there was no welfare state to speak of, so the immigrants had to work to succeed. The fear now is that immigrants can skip that step. They will come to make a better life, sure, but that just means they will soak up our generous welfare benefits.

Is this argument to be taken seriously? On the one hand, there’s the counterargument that no one has the right to stop anyone from moving anywhere or prevent anyone from employing anyone. On this view, borders must be open regardless of whether some people come here for welfare. Proponents of this position are sometimes accused of taking libertarian purity too far. I am not sure what it means to be “too pure”—either one has principles or one doesn’t. In any case, if it turned out that immigration did put more pressure on the welfare system, that might help in the effort to roll it back.

On the other hand, though, there is no evidence that illegal immigrants are a net drain on the welfare rolls. First, illegal immigrants can’t just move here and file for welfare checks. Second, while they may get some benefits of the welfare state, they are a net gain for the economy. The majority of them do come here to get better jobs than they would have been able to get at home—in some cases they take jobs that native-born Americans won’t take. Keep this in mind as we examine the next bogeyman.

Taking Whose Jobs?

Another argument is that immigrants will take jobs away from “real Americans.” The first thing we notice about this argument is that it contradicts the previous one. Make up your mind: Are they coming to take your job or to go on welfare? But more substantially, competition is supposed to be good not bad. When one company competes with another, they are obliged to improve service or lower prices. It is the same thing with labor: If there are other people competing for your job, you’ll have to get better at it. (This would be true even if we had hermetically sealed borders. If you are that uncompetitive at your job, it will be outsourced.) Individual workers, like companies, have no right to be free from competition. Anticompetitive policies impoverish everybody. Lastly, this argument presupposes a fixed number of jobs, such that if one worker is replaced by another, he will never again be able to work at all. In a free market, where resources are scarce and demand is open-ended, there is always work to be done and thus no shortage of jobs. Protectionism is just as bad for workers as it is for companies.

Some fear that since many immigrants are coming from Mexico and the rest of Latin America, increased immigration will lead to increases in the drug trade. This argument is predicated on several mistakes. First, immigrants cannot move their climate with them. I don’t think you can grow coca plants in Wisconsin. If it’s not a matter of moving the crops, then the concern must be that there will be more places to send drugs. But that’s an argument for allowing immigration and normalizing immigrants’ status as Americans with kids in school and jobs in the community. How many of your neighbors and coworkers are drug dealers? Of course, if there were no prohibition, this would be a non-issue. But again we see a contradictory set of fears. Those who think drugs should be illegal, and are worried that increased immigration will increase the drug trade, are undermining their own position. Assimilated, productive, middle-class immigrants won’t be nearly as likely to be drug mules or abettors of illegal activity.

More broadly, some fear that increased immigration will produce more crime. (In one sense this is tautologically true: Increased illegal immigration by definition is increased “crime.”) There’s no way to predict whether immigrants from Guatemala are more or less likely than immigrants from Italy or Ireland to commit crimes, but burglary, robbery, and assault are already illegal. So we have a system in place to respond to crimes regardless of the ethnicity of the criminal. Some argue that this creates added burdens on the penal system, but that’s not a reason to curtail immigration. Of course, the penal system would be considerably relieved of its burden if it were rid of victimless crimes, and in any event violent immigrant offenders could be deported rather than sentenced to American prisons.

No Irish Need Apply

I am afraid that one additional fear about increased immigration is a generic dislike of those of darker complexion. (I hasten to add that I understand that not all anti-immigrant sentiment is so motivated, but it’s myopic to deny that any of it is.) This concern requires some historical perspective. There was a time in the history of American immigration when the Irish were, for all intents and purposes, nonwhite. They were openly discriminated against. Later, when the Irish had been here for a couple of generations, the Italians, Poles, and Jews became the new aliens. Now we think nothing of seeing a Jewish-American or Italian-American CEO or Supreme Court justice, or an Irish-American president.

Today, seeing waves of immigrants from Latin America, South and East Asia, and the Middle East, perhaps some people are concerned about America becoming less white. I can’t say that I feel the need to take this concern too seriously. It seems hypocritical to think that your ancestral homeland has made a great contribution to the American melting pot, but that no new homelands should be able to add to the mix. Nevertheless, for those who are concerned about their neighbors being culturally different, again the solution is to have a completely open stance on immigration. Earlier generations of “foreigners” who emigrated freely were relatively quick to assimilate to the prevailing cultural norms, even while simultaneously changing those norms. The best way to keep new immigrant subcultures alien, mysterious, and possibly hostile is to marginalize them and drive them underground. They can’t assimilate if they can’t get jobs and send their kids to school. Ultimately, “assimilation” is a two-way street: As new groups settle in, elements of the new cultures become part of the ever-changing norm. If you asked a fourth-grader to name four “regular American foods,” you will surely hear “pizza,” and probably “tacos.”

The one point I will concede to the anti-immigration contingent is the worry about voting. Will large numbers of (presumably legal) immigrants vote to make changes antithetical to the American ideal? Well, they might vote for reductions in the welfare state. It turns out that assimilated and upwardly mobile immigrant groups don’t support expanded welfare programs any more than indigenous groups do. If they voted to roll welfare programs back, that wouldn’t be a bad thing. More worrying, will they vote in such a way as to chill speech by, for instance, pressing for bans on cartoons depicting Mohammed? I would be concerned if trends like that started to emerge. Fundamental constitutional principles are not supposed to be subject to majoritarian whim, but I realize they sometimes are. So rather than think of solutions to the problem, it might be better to think of ways to avoid it in the first place. The best way to do that is to help the immigrants to become Americans. That means allowing them to seek work and find ways to contribute to the economy; it means allowing them the freedom to assimilate into, even while subtly changing, American culture—the very same freedom your grandparents had.

The textbook summary is absurd, of course. Far from being a proponent of “might makes right,” Spencer wrote that the “desire to command is essentially a barbarous desire” because it “implies an appeal to force,” which is “inconsistent with the first law of morality” and “radically wrong.”¹ While Spencer opposed tax-funded welfare programs, he strongly supported voluntary charity, and indeed devoted ten chapters of his Principles of Ethics to a discussion of the duty of “positive beneficence.”²

Spencer’s evolutionary theories predated Darwin’s by several years. For Spencer, neither physical nor social order requires deliberate design for its emergence; language, for example, was not the “cunningly-devised scheme of a ruler or body of legislators,”³ nor is the economic organization of society, without which “a great proportion of us would be dead before another week ended,” to be attributed to “the devising of any one.”⁴ Rather, order arises spontaneously, through the operation of natural laws; industrial civilization emerged “not simply without legislative guidance” but “in spite of legislative hindrances,” through the “individual efforts of citizens to satisfy their own wants.”⁵

The two chief modes of social organization are the militant—operating through compulsory cooperation and oriented toward violent conflict—and the industrial—haracterized by voluntary cooperation and peaceful exchange.⁶ The militant mode, Spencer maintained, was necessary at a certain stage in human history, before human beings had fully adapted to social existence; but its day is passing. Since “a society in which life, liberty, and property, are secure, and all interests justly regarded, must prosper more than one in which they do not,” the selective pressures of social evolution can be expected to bring about a gradual shift toward the industrial mode.⁷

Spencer’s long-run optimism was tempered, however, by short-run pessimism; although militant society was destined to give way to industrial society eventually, there would inevitably be temporary reverses and detours along the way. And Spencer believed that the modern world, after a long period of liberalization, was headed into just such a retrograde phase. Observing an increase in “imperialism, re-barbarization, and regimentation,”⁸ he foresaw this trend’s eventual culmination in a “lapse of self-ownership into ownership by the community.”⁹ Like many classical-liberal thinkers at the end of the nineteenth century, Spencer prophetically predicted for the century to come a grim relapse into collectivism and war.

An Ethics of Liberty

In ethics Spencer dismissed the debate between egoism and altruism, maintaining that human interests, properly understood, are so interdependent that one cannot effectively pursue one’s own welfare without giving others’ needs their due, and vice versa.¹⁰ Life and happiness are a human being’s proper goals, but he can achieve these goals “only by the exercise of his faculties,” and so “must be free to do those things in which the exercise of them consists.” But since all human beings by this argument have a moral license to exercise their faculties, “then must the freedom of each be bounded by the similar freedom of all.”¹¹

Hence Spencer derived a Law of Equal Freedom: “Every man has freedom to do all that he wills, provided he infringes not the equal freedom of any other man.”¹² Concluding that “whatsoever involves command or whatsoever implies obedience is wrong,”¹³ Spencer proceeded to deduce, from the Law of Equal Freedom, the existence of rights to freedom of speech, press, and religion; bodily integrity; private property; and commercial exchange—virtually the entire policy menu of today’s libertarians. His moral theory thus demands the complete displacement of the militant mode of social organization by the industrial.

Spencerian ethics is not exhausted by the Law of Equal Freedom; non-interference is the essence of justice, but ethics comprises beneficence (so long as it is voluntary) in addition to justice. Spencer insisted, however, that since production is logically prior to distribution, charitable assistance should aim at helping the needy to become productive rather than habituating them to a condition of dependence.

Liberalism and Democracy

Spencer lived in an age when the word “liberal” was beginning to change from its classical to its modern meaning. Where the earlier liberals had sought to promote the common welfare “as an end to be indirectly gained by the relaxing of restraints,” the new liberals treat the common welfare “as the end to be directly gained,” and by “methods intrinsically opposed to those originally used” — that is, by increasing governmental restraints instead of relaxing them.¹⁴ While the new liberals, like the old, do not “presume to coerce men for their spiritual good,” they nonetheless think themselves “called upon to coerce them for their material good.”¹⁵ “Most of those who now pass as Liberals,” Spencer concluded, “are Tories of a new type.”¹⁶

To the reply that the liberal state, unlike its predecessors, is justified in employing compulsory methods because its edicts express the will of the majority, Spencer answered that a majority imposing its will on a minority stands as much in violation of the Law of Equal Freedom as does the reverse; the “divine right of parliaments” is no less a “political superstition” than the divine right of kings.¹⁷ Spencer granted the need for majority rule, but only on those matters that fall within the majority’s jurisdiction.¹⁸ The purpose of joining together to form a political community is the protection of individual rights; hence decisions about the means to this end fall within the competence of the majority, but decisions contrary to this end do not.¹⁹ Modern democracy renders the individual citizen’s refusal of consent invisible; whatever the citizen says or does is viewed through consent-colored spectacles, obliterating the possibility of a no that means no.²⁰

Spencer saw the decline of liberalism—its deterioration from a doctrine of individual freedom to a doctrine of majoritarian despotism—as part of a general retrogression of modern civilization from industrialism to militarism. For Spencer there was an intimate connection between aggressive warfare abroad and political oppression at home; a society’s “internal and external policies are . . . bound together.”²¹ He denounced European imperialism as a succession of “deeds of blood and rapine” inflicted on “subjugated races” by “so-called Christian nations.”²² But imperialist policies are harmful to the colonizers as well as to the colonized; war diverts capital from productive to destructive uses, thus squandering “the accumulated labor of generations”—and because it gives the domestic economy an illusory “appearance of increased strength,” a state of war encourages politicians to impose higher taxes which the economy cannot in reality sustain.²³

Militarism vs. Trade

Military action to promote international trade is a fraud: “Trade is a simple enough thing that will grow up wherever there is room for it. But, according to statesmen, it must be created by a gigantic and costly machinery.”²⁴ In fact, such wars are waged not to promote the economic welfare of the common people, Spencer maintained, but instead to benefit powerful special interests, “rich owners” — the beneficiaries of government-granted privileges and monopolies — at the expense of “the poor, starved, overburdened people.”²⁵

While allowing that warfare is permissible as self-defense, Spencer added that few wars described as “defensive” really are such, and denounced any nation that “gives to its soldiers the euphemistic title ‘defenders of their country,’ and then exclusively uses them as invaders of other countries.”²⁶ Spencer thus opposed his own nation’s military adventures in Afghanistan, India, South Africa (the Boer War), and elsewhere.

Foreign expansionism, Spencer taught, brings domestic tyranny in its wake. Given that “the nations of Europe are partitioning among themselves parts of the earth inhabited by inferior peoples, with cynical indifference to the claims of these peoples,” the governments of these nations can hardly be expected to “have so tender a regard” for the rights of their own citizens.²⁷ Indeed, “the exercise of mastery inevitably entails on the master himself some form of slavery,” since unless he means to let his captive escape, he must continue to be fastened by keeping hold of the cord.”²⁸ Hence the need to maintain the subjugation of foreign peoples inevitably requires an ever greater imposition of constraints on the conquering state’s domestic citizens as well, until “the army is simply the mobilized society and the society is the quiescent army.”²⁹

While the long-run tendency of social evolution, he believed, is toward industrial society, and thus toward peace, Spencer viewed the immediate future with despair—in his later years increasingly so. The inexorable short-run trend of modern civilization, he came to believe, is toward greater political centralization, hyper-regulation, and militarism; as governments grow more powerful, popular culture grows more vulgar and brutal, each trend serving to reinforce the other. The few remaining lovers of peace and liberty are doomed to political irrelevance as militant society regains dominance for the foreseeable future.

At the time of Spencer’s death the number of libertarians was indeed dwindling. Today, a century later, it is growing. The centralized, hierarchical information channels of the political elite have been superseded by the Internet, the supreme embodiment of voluntaristic, “industrial” social interaction. The state still regulates, regiments, and kills, but an antithetical mode of life is sprouting in its interstices.

Spencer saw his own voluminous writings as a bitter cry of protest in the face of irresistible defeat. But for those of us who stand at the beginning of the 21st century, they can serve instead as an inspiration in our struggle to reverse the trend of history from the militant to the industrial mode.

—————-

1. Herbert Spencer, Social Statics: The Conditions Essential to Human Happiness Specified, and the First of Them Developed (New York: Robert Schalkenbach Foundation, 1970), pp. 144-45, available online at oll.libertyfund.org/Texts/ToC/0331 _ToC.html.
2. Herbert Spencer, The Principles of Ethics (2 vols.), ed. Tibor R. Machan (Indianapolis: Liberty Fund, 1978), available online at oll.libertyfund.org/Texts/ToC/0155_ToC.html.
3. Herbert Spencer, The Man Versus the State, with Six Essays on Government, Society, and Freedom (Indianapolis: Liberty Fund, 1992), p. 437; available online at www.econ lib.org/library/LFBooks/Spencer/spnMvSContents.html.
4.Herbert Spencer, Illustrations of Universal Progress: A Series of Discussions (Chestnut Hill Mass.: Elibron Classics, 2000), p. 320.
5. Ibid., p. 320.
6. The Man vs. the State, p. 6.
7. Herbert Spencer, The Principles of Sociology, vol. 2 (New York: D. Appleton, 1884), p. 608.
8. Herbert Spencer, Facts and Comments (New York: D. Appleton, 1902), p. 200.
9. Herbert Spencer, The Principles of Sociology, vol. 3 (New York: D. Appleton, 1910), p. 605.
10. Principles of Ethics, vol. 1, pp. 217-85.
11. Social Statics, p. 69.
12. Ibid., p. 95. (This is the passage to which Justice Oliver Wendell Holmes was referring when, in his famous dissent in Lochner v. New York, he opined: “The Fourteenth Amendment does not enact Mr. Herbert Spencer’s Social Statics.”)
13. Ibid., p. 145.
14. The Man Versus the State, pp. 14-15.
15. Ibid., pp. 267-68.
16. Ibid., p. 5.
17. Ibid., pp. 24, 123.
18. Ibid., p. 130.
19. What about people who do not wish to join any political community, for any purpose? In his first book, Social Statics (1851), Spencer included a chapter on “The Right to Ignore the State”; in later years he deleted the chapter from subsequent editions, apparently embarrassed by its anarchistic implications.
20. Social Statics, p. 190.
21. The Man Versus the State, p. 174.
22. Social Statics, pp. 328-29.
23. The Man Versus the State, p. 211.
24. Social Statics,, p. 323.
25. The Man Versus the State, p. 220.
26. Principles of Ethics, vol. 2, p. 67.
27. Ibid., vol. 2, pp. 239-40.
28. Facts and Comments, p. 158.
29. The Man Versus the State, p. 74.

The market is a complex order. A thief needs only violence to get rich; a cattle trader needs more things, such as order and justice; in other words, an environment where transactions can be safely completed. The market does not obey “the law of the jungle”—just the opposite: The law of the jungle prevails where there are no markets. Peaceful exchange with secure property rights is more productive than widespread robbery, but many criticize the rich regardless of the path they followed to opulence, as if they all had achieved their wealth illicitly. Apparently, George Bernard Shaw’s fallacious quotation still rules the day: “I am a gentleman: I live by robbing the poor.”

The most common way to make a fortune in a free market is organizing a successful company. How can this company succeed and pay handsome salaries? In a free market there is only one answer: by making something consumers appreciate. Under such circumstances, the businessman’s wealth is linked to the social utility of his labor, a utility proved by consumers who buy because they too benefit from the deal.

Of course, one can always make money breaking the law, as thieves and swindlers do. And there is also another method that, while unjust, does not always appear that way: to become rich by avoiding competition or gaining other privileges that only the state can grant.

Monopolies and protectionism exemplify these strategies. Both became the enemies of classical liberals, who argued in favor of the free market and against the privileged groups that injured the majority of the population by imposing high prices and limiting the ability to choose.

Alongside the state’s expansion during the past century, opportunities to profit from using the state to avoid competition have proliferated. Through the apparatus of government, lobbying groups have obtained power over their markets, subsidies, and every other kind of anticompetitive protection.

Blocking market activity breaks the connection between social needs and the supply of goods and services aimed at satisfying them. But it may turn out to be profitable: Fortunes have originated in anti-competitive privileges bestowed by political power or made possible by its regulations. In such cases it is fair to distrust the wealthy.

Often, however, no distinction is made when it comes to criticizing rich people. They all appear reproachable, and few dispute the need to impose on them specific burdens and progressive tax scales aimed at dealing with the “problem” of inequality. The state must force-fit all of us into a Procrustean bed.

Internal Robin Hood Service

Many thus would have the state play Robin Hood, robbing from the rich (no matter how they got the money) and giving to the poor. I do not dispute that this legend is open to several interpretations, including a plausible libertarian one. Robin Hood can be seen as an enemy of tyranny and the abuse of law, a friend of the people, a man who robbed tax collectors and privileged aristocrats, returning the money to the victimized peasants. This is a very appealing version of the story. My objection, however, is directed exclusively at the danger of casting the modern state in the powerful image of a hero seeking redress and justice. It uses this image to legitimize its vast distribution operations and to show its supposed liberality.

The notion of the state playing Robin Hood has two weaknesses. First, there is no way to prove that if the authorities take a dollar by force from a rich person and give it to a poor person, the collective happiness increases. As Anthony de Jasay says, the only way to solve the problem of comparisons between individuals is for the state to impose its preferences on the community. The outcome of these operations, in the words of Bertrand de Jouvenel, is not a redistribution of income from rich to poor but from everyone to the state.

The second weakness in the state-as-Robin-Hood argument is that it only works if the treasury is small. The state in the days of Robin of Locksley was limited, but when it takes on modern proportions, no matter what Barack Obama may say, it can no longer finance itself only by taking money from the very rich, who are by definition a minority. The state might pretend to do this, but in practice its only financing option is to take money from everyone.

One of the main arguments for the growth of the modern state is the fight against inequality. Some claim that without the state’s intervention, human beings would abandon the poor to their own devices and charity would prove both insufficient and insulting.

The allegation that, without the state’s helping hand, people would ignore their fellow human beings in poverty can’t stand even a cursory analysis. From the dawn of civilization, examples to the contrary abound. Voracious tax increases have not managed to extinguish the humanitarian impulse.

Charity is a noble and deep human feeling. Why is it dismissed and devalued? Why is it deemed humiliating, while state aid is viewed as a display of compassion?

Virtue Requires Liberty

Helping our fellow man and political distribution are very different actions. Let us take as an example the noble conduct of the Good Samaritan, a beautiful portrait of humanitarianism. A basic assumption—in truth, an essential element—of the parable is liberty. The Good Samaritan’s virtue stems from the fact that he acts voluntarily; if a centurion forced him to help the poor Jew, beaten and abandoned in the road, the parable would have made no sense. Virtue, in effect, demands liberty.

In this example, we see the demoralizing effect of state expansion. Many nongovernmental organizations, particularly in Europe, do not ask citizens to freely and voluntarily hand over a fraction of their income. Instead, they ask the state to extract sums from taxpayers’ pockets. Amazingly, the sacrifice of liberty and responsibility on the altar of political power is praised, while providing free and voluntary aid to one’s fellow man is dismissed as humiliating charity.

The fact is that where markets are permitted to work, fewer people need economic assistance of any kind. The centuries since Adam Smith wrote The Wealth of Nations have provided ample evidence to support his message: Free trade and security in one’s rights are the pillars on which individuals can improve their condition. Despite this, many people criticize the market economy and allege that it encourages marginalization. It is common to read statistics showing great poverty and accusations that market-oriented countries like the United States are infernos of inequality.

Not Condemned to Poverty

The problem with such statistics is that they are based on surveys that fail to track the same people through time. Thus they cannot provide the most important piece of information: Are the poor condemned to poverty or are they able to rise out of it? The statistics, in short, rarely measure social mobility. But when they do, they show that the poor have large possibilities of escaping the lowest percentile of income distribution. It is in fact more probable that a very poor person in America will climb to the highest income rung than that he will remain in poverty. One could argue that the data indicate mobility but not improvement, given that there is always a poorest 20 percent. Incomes in an advancing society like the United States, however, are not constant but rather are increasing—despite pervasive government interference—and this, not welfare, offers everyone the opportunity and the incentive to progress.

State-Sanctioned Inequality

Socialists and interventionists of all parties have reluctantly ended up accepting the market, but they claim government intervention is necessary to tackle inequality. However, inequality is only objectionable if there is a lack of competition and freedom. The modern state’s onerous and inefficient distributive structures, ostensibly built to wipe out inequality, have had perverse effects and a demoralizing impact on society, pushing different groups to fight over public favors. It is an out-of-control process in which, as the German liberal Ludwig Erhard said, everyone puts his hand in the pocket of everyone else.

The clamor from interventionists against inequality morphs into a clamor for a larger and larger state. This path leads to the loss of liberty and a distortion of both democracy and justice. It distorts democracy because, by attempting to solve inequality, it removes limits to power and expands the field of state action. It distorts justice because the only way to solve inequality politically is for the state to have the power to treat individuals unequally. Thus the struggle to eliminate inequality ends up destroying the most important form of equality for an open society: equality before the law.

Often, however, sympathy and compassion are transformed from tools of moral judgment and action into weapons of blind ideology, irrational emotionalism, and cynical politics. They particularly serve as the bat with which opponents of the welfare state get pummeled. After all, the argument goes, if you oppose an extensive network of government income, housing, healthcare, employment, and child-care assistance programs, you must be severely lacking in sympathy and compassion. To truly care, you must support big government.

That assumption, unfortunately, has long clouded the debate over welfare policies, especially when it comes to government programs affecting family life. The big-government crowd has pushed blindly for government to play an ever-larger role as financial provider for households, thereby contributing critically to the undermining of traditional families. Meanwhile, it should be noted that some who argue against such programs have tried to make their case without fully acknowledging the important economic and societal roles played by the family.

Too many on both sides of this debate have been guilty of declaring that “family” can mean whatever one likes—therefore saying, in effect, that “family” lacks any significant meaning or purpose.

Part of the problem is the failure to apply economic analysis to the family’s role in the economy and to the impact of government policies on the family. That has been remedied to a degree in The War Between the State and the Family: How Government Divides and Impoverishes by Patricia Morgan. Published initially by the London-based Institute of Economic Affairs, it mainly deals with the programs and realities of Great Britain, but the discussion and analysis obviously apply elsewhere, including the United States.

Morgan pulls together overwhelming evidence and data showing the benefits to adults, children, and society in general of marriage and intact families, and the problems of non-marriage, single parenthood, and divorce. And she illustrates how the welfare state subsidizes and encourages family breakdown.

For example, Morgan shows that marriage boosts personal responsibility and employment among males, while single males are far more likely to be jobless and receiving government assistance. She also makes clear that government benefits have a strong impact on marriage and childbearing decisions and responsibilities among both men and women.

She notes the varying ways in which government policies affect such critical decisions: “By rewarding some behaviours and penalising others, tax and welfare systems affect the preference and behaviour of individuals not just through hard cash calculations but by (unavoidably) embodying and promoting certain values and assumptions. . . . The generous subsidisation of the lone-parent household cannot but reinforce the belief that it is quite acceptable for men to expect the state to provide for their offspring.”

Morgan sums up the implications of all this on the size and intrusiveness of government: “Growing family and household fragmentation” drives government spending and taxes ever higher; increases the “number of clients of the state”; “displaces existing institutional and private arrangements”; places the government in the role of parent and provider to children; allows for increased government intrusions into family life; and generates “an increasing mass of legislation and regulation of provisions for custody, access and financial support.” For good measure, child development is inevitably hampered due to the loss of “private investment in children,” which can never be matched in substance or quality by government programs.

What’s the solution? Morgan provides a straight-forward answer: “The benefits to society of family commitments within households, including marriage, are so huge that these institutions should be nurtured rather than eradicated. There is no need to denigrate other ‘lifestyles’: the tax and benefits system should just stop discouraging family commitment and treating it as superfluous.”

After digesting the formidable data, evidence, and arguments harnessed in Morgan’s book, it is hard to see how anyone claiming to possess sympathy and compassion for others could still rationally embrace a welfare system that, intentionally or not, undermines personal responsibility, destroys the traditional family (thereby undermining its accompanying benefits), and hurts children. If we are serious in our concern for others, then, as Morgan closes her book, “Voluntary action within and between families and households should be the first source of welfare.”

Given all the problems that come with government, including waste and loss of freedom, government action should always be a last, desperate resort. Unfortunately, for decades government action has been the first resort in dealing with social problems. When it comes to family life, the negative fallout from this government-first philosophy should be obvious to all who understand economics and feel compassion for others.

Imagine playing a game—baseball, cards, “Monopoly,” or whatever—in which there was only one rule: anything goes.

You could discard the “instruction book” from the start and make things up as you go. If it “works,” do it. If it “feels good,” why not? If opposing players have a disagreement (an obvious inevitability)—well, you can just figure that out later.

What kind of a game would this be? Chaotic, frustrating, unpredictable, impossible. Sooner or later, the whole thing would degenerate into a mad free-for-all. Somebody would have to knock heads together and bring order to the mess.

Simple games would be intolerable played this way, but for many deadly serious things humans engage in, from driving on the highways to waging war, the consequences of throwing away the instruction book can be almost too frightful to imagine.

The business of government is one of those deadly serious things, and like a game run amok, it’s showing signs that the players don’t care much for the rules any more, if they even know them at all.

Don’t think for a moment that by use of the term “players” I’m pointing fingers at politicians and somehow absolving everyone else of responsibility. In a sense, all of us are players; it’s just that some are more actively so than others, and of those who are active, some are more destructively so than the rest. At the very least, every citizen has a stake in the outcome.

The most profound political and philosophical trend of our time is a serious erosion of any consensus about what government is supposed to do and what it’s not supposed to do. The “instruction books” on this matter are America’s founding documents, namely the Declaration of Independence and the original Constitution with its Bill of Rights. In the spirit of those great works, most Americans once shared a common view of the proper role of government—the protection of life and property.

Jefferson himself phrased it with typical eloquence: “Still one thing more, fellow citizens—a wise and frugal Government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government.”

Today, there is no common view of the proper role of government or, if there is one, it is light-years from Jefferson’s. Far too many people think that government exists to do anything for anybody any time they ask for it, from day care for their children to handouts for artists.

Former [and current] Texas Congressman Ron Paul used to blow the whistle whenever a bill was proposed that violated the spirit or the letter of the Constitution. How were his appeals received by the great majority of other members of Congress? “Like water off a duck’s back,” Paul once told me.

In a series of lectures to high-school classes one day last October, I asked the students (most of whom were seniors) what they thought the responsibilities of government were. I heard “Provide jobs” far more often than I heard “Guarantee our freedoms.” (In fact, I think the only time I heard the latter was when I said it myself.)

An organization called the Communitarian Network made news recently when it called for government to make organ donations mandatory, so that each citizen’s body after death could be “harvested” for the benefit of sick people. A good cause, for sure, but is it really a duty of government to take your kidneys?

Americans once understood and appreciated the concept of individual rights and entertained very little of this nonsense. But there is no consensus today even on what a right is, let alone which ones we as free citizens should be free to exercise.

When the Reagan administration proposed abolishing subsidies to Amtrak, the nationalized passenger-rail service, I was struck by a dissenter who phrased her objection on national television this way: “I don’t know how those people in Washington expect us to get around out here. We have a right to this service.”

When Congress voted to stop funding the printing of Playboy magazine in Braille, the American Council of the Blind filed suit in federal court, charging that the congressional action constituted censorship and the denial of a basic right.

The Cheapening of Rights

The lofty notion that individuals possess certain rights—definable, inalienable, and sacred—has been cheapened and mongrelized beyond anything our Founders would recognize. When those gifted individuals asserted rights to “freedom of speech” or “freedom of the press” or “freedom of assembly,” they did not mean to say that one has a right to be given a microphone, a printing press, a lecture hall, or a Playboy magazine at someone else’s expense.

Indeed, the Founders’ concept of rights did not require the initiation of force against others, or the elevation of any “want” to a lawful lien on the life or property of any other citizen. Each individual was deemed a unique and sovereign being, requiring only that others either deal with him voluntarily or not at all. It was this notion of rights that became an important theme of America’s founding documents. It is the only notion of rights that does not degenerate into a strife-ridden mob in which every person has his hands in every other person’s pockets.

Millions of Americans today believe that as long as the cause is “good,” it’s a duty of government. They look upon government as a fountain of happiness and material goods. They have forgotten George Washington’s warning, “Government is not reason; it is not eloquence. It is force. And like fire, it is a dangerous servant and a fearful master.”

Wisdom like that prompted Washington and our other Founders to write a Constitution that contained a Bill of Rights, separation of powers, checks and balances, and dozens of “thou shalt nots” directed at government itself. They knew, unlike many Americans today, that a government without rules or boundaries, that does anything for anybody, that confuses rights with wants, will yield intolerable tyranny.

We have tossed away the instruction book and until we find it and give it life and meaning in our public lives, we will drift from one intractable crisis to the next. Something more important than any handout from the State—namely, our liberty—hangs in the balance.

Candidates and others who are set on securing the Mexican border—the Canadian border seems of less concern—and expelling those who had the audacity to come to the land of the free without permission mainly rely on two arguments: jobs and welfare. If those are the best arguments they’ve got, they don’t have much.

The first is easily dismissed. Any free-market advocate knows that what is in short supply is not work but workers—if government does not interfere with individual freedom. This is not news, but just another way of saying that we live in a world of scarcity. Free people can loosen the bonds of scarcity, but can never eliminate them. This will be true as long as a quantity of resources put to one purpose can’t simultaneously be put to some other purpose. Under freedom long-term involuntary unemployment is impossible. If tomorrow we need only half the number of people it takes today to make a steady supply of some product, we’ll be able to afford things we can’t afford today and our living standard will rise.

To be sure, we live in a society blanketed by government intrusion that ossifies labor and other markets in a variety of ways: taxes, minimum-wage laws, occupational licensing, anticompetitive favors to business, union laws, and more. Such interventions may make it tougher for unskilled or low-skilled workers to find new jobs if the old ones are lost to someone willing to work for less. The wrong way to address that problem, though, is to go after immigrants who are “taking jobs from Americans.” The moral claim to freedom, including the freedom to deal with those who have jobs to offer, should not be a function of where one was born. It’s a function of being human, no matter the birthplace. Let’s free the markets rather than restrict the freedom of individuals.

A similar point applies to welfare. I don’t know what percentage of immigrants, “legal” and otherwise, take benefits provided by the state. Everyone can cite a study to support his intuitions on the matter. Such cherry-picking of data always makes me uncomfortable.

Fortunately, we don’t need data on an issue like this. If you don’t want people taking welfare benefits, go after the dispenser of the benefits, not the people who simply accept what is offered. If you fear that immigrants will strain the government’s schools and hospitals, ask why government is in education and health in the first place. I don’t hear Wal-Mart and other private retailers complaining about new customers.

To listen to some immigration opponents, you’d think the worst thing that can possibly happen is for a foreign-born person—especially one without government papers—to take a welfare benefit. Why it matters where a welfare recipient was born, I can’t say. After all, independent migrants pay taxes, so why are they less entitled than American citizens? No one should be eligible, but if immigrants are to be singled out, shouldn’t they be tax-exempt too? That’s not a bad deal.

At any rate, I can think of worse things than “illegal aliens” taking welfare:

1. Native-born Americans’ taking welfare. After all, they were born in the “land of the free.” Shouldn’t they know better?
2. Police-state tactics designed to prevent immigration or to catch people who made it through. Those tactics include storm-trooper raids at workplaces, witch hunts of employers who take the idea of free enterprise seriously and hire whomever they please, and ominous national-identification devices.
3. The routine exploitation of people who are vulnerable to thugs and cheats because of their “illegal” status.

I like what Freeman contributor Charles Johnson (blogger at Rad Geek People’s Daily, http://radgeek.com/) wrote online about this: “As for the welfare state, they [“illegals”] are welcome to milk it dry, as far as I’m concerned. The sooner the damn thing is on the brink of collapse, the better. Besides which, receipt of government benefits is not ipso facto a violation of anyone’s rights—it’s the funding that’s the problem, but illegal immigrants aren’t complicit in the existence of taxation—and insofar as they are able to receive some minimal payouts from the State, that may as well count as partial restitution for the daily threats, terror, and violence that the state and federal governments routinely inflict against the property and liberty of all undocumented immigrants.”

It’s really time we got our priorities straight.

* * *

The destructive wildfires in California last fall were tragic enough. Must they be turned into a crusade for more government power? Steven Greenhut pulls aside the curtain.

According to the standard political framework, no one person should be against imperial wars and for free-market money. But as Steven Horwitz shows, historically these two positions were a staple of the freedom philosophy.

New York City’s mayor wants to charge people to drive into Manhattan. Known as “congestion pricing,” any resemblance the idea has to the free market is purely coincidental. Becky Akers explains.

Over the last couple of years the power of prosecutors to ruin innocent people’s lives has become too obvious to ignore. Wendy McElroy discusses the infamous Duke “rape” case.

Politics is portrayed as a noble endeavor, but if you scratch the surface you find some people trying to force other people to pay for their pet projects. George Leef applies this principle to so-called historic preservation.

Government wrecked the railroads in Britain, but voluntary efforts are bringing them back. Does this mean there’s an alternative to providing services either through force or love of money? James Payne takes up the question.

Here’s what our columnists’ deliberations have yielded: Richard Ebeling considers the nature of interventionism. Donald Boudreaux unveils the real reason Prohibition was repealed. Burton Folsom revisits a time when presidents actually vetoed spending bills they thought were unconstitutional. John Stossel warns against expecting the government to be able to cool down the planet. Walter Williams emphasizes the economic role of property rights. And Robert Murphy, reading the claim that the Federal Reserve isn’t really bailing out big mortgage lenders, protests, “It Just Ain’t So!”

Our reviewers have the skinny on books about health care, Native Americans, Wal-Mart, and Adam Smith.
    —Sheldon Richman
      srichman@fee.org

As such, the number of severely poor Americans grew by 26 percent from 2000 to 2005, so that 16 million Americans were living in deep, or severe, poverty. This is defined as a family of four with two children and an annual income of less than $9,903, or one-half the federal poverty line.

On their face, these figures sound ominous and suggest that the U.S. government and the American people have turned their backs on the weakest citizens. But truth and reality are much more complex than the raw data suggest.

As it is, the U.S. government has spent close to $10 trillion (current dollars) on domestic welfare programs since President Lyndon Johnson launched the “War on Poverty” in 1965. These include Aid to Families with Dependent Children (now Temporary Assistance to Needy Families—TANF); food stamps; Medicaid; the Special Supplemental Food Program for Women, Infants, and Children (WIC); utilities assistance under the Low-Income Home Energy Assistance Program (LIHEAP); housing assistance under a variety of programs, including public housing and Section 8 rental assistance; and the free commodities program. And then state and local governments engage in welfare spending that includes free medical care for the impoverished through charity hospitals.

Spending on all social programs is up by 22 percent (inflation-adjusted) since 2000. In 2004 total government spending on low-income families was $129 billion, or $9,058 per poor family.

Besides all this public-sector spending, private charities and religious organizations offer considerable aid to the indigent, ranging from soup kitchens to housing and so forth.

Now let’s look at the official poverty rate for the United States as estimated by the Census Bureau from data on poverty and income collected in an annual survey and defined according to household size and makeup. For example, the average poverty threshold for a family of four was $18,392 in annual income in 2002.

The official rate combines the money income of individuals and families before taxes with cash assistance received from government programs. That is compared with established poverty thresholds. These thresholds vary according to the size of the family and are adjusted annually to account for the effects of inflation.

But this official estimate does not include noncash government benefits like public housing, Medicaid, free or subsidized medical care, or food stamps.

In all events, the financial resources of the “poor” in the United States tend to be undercounted. For example, the poor tend to underreport income to the Census, perhaps because they fear it will be reported to the IRS. Consequently, Census figures on income relative to spending indicate that the poor spend $1.94 for every dollar of reported income.

Moreover, poverty measures ignore the value of household assets like housing. Data from 1995 indicate that 41 percent of all “poor” households owned their own homes, with an average size of three bedrooms and one-and-a-half bathrooms—and most had a garage and a porch or patio. Among the poor, three-quarters of a million owned homes worth over $150,000.

The average “poor” American lives with one-third more living space than the average Japanese, 25 percent more than the average Frenchman, 40 percent more than the average Greek, and four times more than the average Russian. In America 70 percent of “poor” households owned a car and 27 percent had two or more cars.

If absolute poverty is considered to be the lack of access to sufficient resources to satisfy basic needs, there is not much of this in the United States. As in most countries, relative poverty is a bigger issue.

But relative poverty can never be fully resolved without implementing an incentive-destroying policy of equal income regardless of effort or talent. History provides little evidence that forced income redistribution through taxation can alleviate mass poverty.

And so it is that despite massive amounts of spending by governments, poverty remains at a high rate in the United States. Or perhaps it is better said that public-sector welfare and other aid programs are causing poverty since the poor become dependent on handouts instead of looking for work or starting a business. (See Charles Johnson’s article on page 12 to understand why the poor have trouble starting businesses.)

Government officials who spend so much of other people’s money have weak incentives to see that it is spent well. Indeed, the so-called war on poverty has been no more effective than the war on drugs and probably less so than the war in Iraq.

Perhaps a better response to poverty would be to reduce the reliance on governments. The slack could be made up by elements of civil society, such as private charities, that are more effective than welfare programs in serving the poor.

As it is, 85 million American households give a total of $250 billion to charities each year. Interestingly, private Americans gave more to the victims of the Asian tsunami than the federal government did.

Giving is not limited to the very rich. The working poor give as large a percentage of their incomes as do the rich and a lot more than does the American middle class.

Were it not for so many public policies that undermine private giving, this amount would almost certainly be larger. For example, private foundations face punitive regulation, and government subsidies to nonprofits crowd out charity. On the one hand, subsidies reduce the incentive for those groups to seek voluntary contributions, and on the other they reduce the incentive for individuals to donate since they already “gave at the office” when taxes were withheld from their paychecks. Moreover, many policies reduce disposable incomes of major donors.

It is important to know what lies behind the data on the extent of poverty and giving in America. It is wrong to think that Americans are shirking their obligations to needy neighbors or that the U.S. government should do more.