Tuesday, June 26, 2012

The Case Against More Redistribution: It's Redistributive INjustice

Caught up in the passion of the civil rights era, I quit a medical research position at the prestigious Rockefeller University to become a drug counselor in an inner-city New York City junior high school.

There, I used every IQ point, every bit of passion and drive I had, to help those kids. Yet after two years, feeling I hadn't made much difference, I quit.

I blamed myself and hoped that if I learned more, I'd be more effective. So I went and got a PhD from Berkeley with two specializations: educational psychology and the evaluation of innovation. Alas, I found the educational psychology tools puny, unlikely to make much difference with low achievers. And my evaluation training made clear to me that efforts to help the at-risk have--despite politicians' and advocates' rhetoric--made no significant enduring difference, with Head Start being a prime example, not withstanding politicians' rhetoric to the contrary.

After completing the PhD, I did take one more good shot at helping the disadvantaged. For three years, I taught inner-city kids in predominantly low-income Richmond, CA but quit when again, despite most of my students insisting I was the best teacher they ever had, I felt I made no enduring difference, certainly less than if I had directed my efforts to helping people who faced less daunting obstacles.

Since then, I've been career and personal coach to 4,000 less problemed people and am confident I've more abetted their lives and, in turn, society than if I had spent my career helping "the least among us."

Alas, today it seems that society's core belief is that we must redistribute yet more human and fiscal resources to the have-nots. Every time financially prudent countries bail out countries that lived beyond their means like Greece, every time we pass a law to help low achievers, every time we donate to a nonprofit that helps the illiterate, every time we choose to devote our career to the less fortunate, we are practicing redistribution. A few more specific manifestations: No Child Left Behind, affirmative action, progressive taxation ((The top 5% already pay 59% of the federal income tax.) , Disparate Impact legal theory, the World Bank, foreign aid to developing nations, choosing a career as a social worker, in public administration, as public health nurse, executive in an anti-poverty program, etc.

While well intentioned, I believe that such choices are short-term feel-goods that, long-term, are worse for society than if the human and financial resources were invested elsewhere. As every triage medic knows, when you have limited resources and time, you save more lives if you focus not on the worst cases but on those with greater potential to benefit. 

A civilized society should provide a basic safety net for all people but we've gone well beyond that and the trend is to go much further still. 

For example, consider the wisdom of spending yet more of our tax dollars on yet another education "innovation," job retraining program, or extending 99-week unemployment checks to more people. I believe that less societal benefit will accrue from such investments than for example, from investing in top biotech companies. In the latter, some of that investment will go to developing cures for diseases afflicting enormous numbers of people and their families. With regard, for example, to extending unemployment checks, every time they do it, most of my clients become less motivated to look for work: "I'll start looking when my unemployment checks are close to running out." Not one has said they feel bad about taxpayers subsidizing their sitting around.

Even the disadvantaged would ultimately benefit more from investment in high-quality companies. More innovation leads to more jobs, more cures, more quality of life enhancers. Today, even most of the poor have access to life-saving medication, televisions, a cell phone, the Internet and Google.

There's an additional negative side effect of redistribution. One of psychology's most agreed-on postulates is that you get more of what you reward, less of what you punish. If we punish successful people by forcibly taking money from them (that is what taxation is) to give to a pool of people who, net, contribute less to society, we'll get fewer societal contributors to and more takers. Can it ultimately be good for society for people to feel they have the right to take a "fair share" of what other people have earned? Yet that is the message of liberals, the 99ers, The Occupiers, etc.

I invite you to reconsider the wisdom of today's largely unquestioned core belief--that it's wisest to redistribute yet more from the haves to the have-nots. Beyond providing a basic safety net,I believe it's wiser to invest additional time and money in what will make the biggest difference: for example, in Apple than in the at-risk. 

Thus, net, I believe that additional redistributive "justice," is redistributive injustice.

1,000 of Dr. Nemko's published writings and sometimes controversial blog are are on www.martynemko.com. His 6th and 7th books were published in 2012: How to Do Life: What they didn't teach you in school  and What's the Big Idea? 39 Reinventions for a Better America


Dan said...

What about compassionate self interest? Instead of making it your goal to help others or even investing in companies that may someday cure cancer, focus on yourself and your goals: amassing wealth and knowledge, fulfilling dreams. The ancillary outcomes of that self interest -- you tip the waiter a little more because you're rich, you set an example for others because you're enjoying your life, you employ others because you wanted a better standard of living for yourself. Who can say that a man who becomes the next Donald Trump does not done more overall "good" for society than a nose-to-the-grindstone do gooder who always thinks of others?

Anonymous said...

Your analysis is irrefutable. Unfortunately the education elite wears political blinders guaranteeing the continuation of their destructive policies.

Michael R, Edelstein, Ph.D.

Buck Bard said...
This comment has been removed by the author.
Marty Nemko said...

Buck, my essay OPPOSES redistribution.

Buck Bard said...

That's what I get for reading these before coffee.....

Great post.

Anonymous said...

I was listening to NPR this morning about the Obamacare ruling...Many people are worried about rising insurance premiums and "what to do about this..." Every expert and politician refuses to discuss the major impetus behind rising premiums: Medicare, Medicaid, and SCHIP. Basic economics dictates that when you have the government paying for health care in a private, for profit medical system, prices will go up, and health care will be over utilized. Why isn't this even being discussed???

Anonymous said...

Hey Marty, didnt you once say in one of your articles that an income of 250k/year was plenty enough for anybody, And so why is the redistribution an injustice? Love reading you.

Marty Nemko said...

Good question. 250K is plenty enough but I believe greater societal good accrues from leaving it in the pocket of someone who might invest it in a company that will produce a valuable new cure, technological advance, etc, than to redistribute it it to social programs for the poor which have shown terrible return on investment. As I said, I support providing a basic safety net for those who truly cannot be self-supporting, but beyond that, my calculus is that redistribution is a net negative for society.