[Market Economy Guide] The Pitfalls of Egalitarian Policies

“If everyone gets the same grade based on the average score, in the end no one studies and everyone gets an F.

Egalitarianism that does not reward effort fails because it cannot motivate people to work.”

As the economy has developed, the number of people living in absolute poverty has declined, but relative income disparities have widened. Solving the problem of absolute poverty does not mean all concerns disappear. Some people feel relatively wealthy, while others feel relatively poor. This sense of relative poverty has long stirred controversy in democratic countries. Welfare policies are needed for those who cannot support themselves by their own means. However, egalitarian policies in which the government tries to eliminate the relative gaps that normally appear in society have generally brought about welfare dependency and social disorder.

Relative gaps and welfare policy

To students who argued that everyone in society should enjoy equal wealth, a university professor made the following suggestion: what if every student in the class received the same grade based on the average score?

All the students agreed to the professor’s proposal, and the semester began. Before long, the first exam was given, and the class average was a B. Every student received a B for the first exam. The students who had studied hard complained, while those who had spent their time playing around were pleased. Then, some time later, the second exam was given. The students who had not studied continued not to study, and even those who had previously worked hard stopped preparing, thinking they could free-ride. In the end, the class average came out to a D, and every student received that grade.

No one studies, and the whole class gets an F

This time, all the students complained about their grades, but even so, no one tried to study hard. As a result, on the third exam everyone received an F, and after that they continued to receive F grades on every exam until the end of the semester. The students blamed one another and even cursed at each other, but no one tried to study. In the end, every student received an F on the final report card.

This story was created to expose the falsehood of egalitarianism. It clearly shows that attempts to divide things equally among everyone are bound to fail. If what one has earned through one’s own effort is to be given to others without compensation, who would want to work hard?

Bernard Lewis, author of What Went Wrong?, says that the reason the Islamic world of the Middle East, which had been ahead of Europe for 1,000 years in the Middle Ages, eventually fell behind Europe was its “tendency to shift responsibility onto others.” Muslims in the Middle East sought the cause of their backwardness outside themselves. Arabs claimed that Ottoman Turkish rule had blocked their development, while Turks argued that Arab backwardness had held them back. They even blamed Mongol rule, and in the 19th century they pointed to the Western powers and the Jews as the cause of Islamic decline. But those were not causes; they were merely results.

In reality, it was contradictions within Islam itself that brought about the collapse of that civilization. There may have been countless reasons, such as exploitative institutions and an attitude that disregarded science and technology, but the fundamental reason was the absence of freedom. Religious fundamentalism and a fundamentalist culture restricted freedom across society, including in the religious sphere.

Envy, jealousy, and personal responsibility

It is also interesting to note the claim that the discontinuation of cart use was a major cause of decline. Why did the use of carts disappear in the Middle East, where the wheel was first invented? In the Middle East, those who owned carts were considered wealthy. Whenever the state went to war or undertook construction projects, cart owners often had their carts requisitioned. Proper compensation was not provided. Nor was public sentiment favorable toward wealthy people who possessed such a large asset as a cart. In the end, people gradually became reluctant to own carts, and before long the use of carts declined. This led to a decline in the movement of people and goods, which in turn led to economic decline. People came to fear a power that could arbitrarily seize private property, and society became one in which the principles of personal responsibility and freedom could no longer function.

A life in which one leads one’s own life with a sense of responsibility is a happy life, and a society made up of such individuals can be a healthy one.

■ Please remember

In a society where envy of the haves is widespread, that jealousy is translated into laws and taxes. The problem is that such oppression of those who have more ultimately suppresses freedom throughout society. Individual freedom shrinks, and society loses its vitality and falls into stagnation.

Sung-no Choi, President of the Center for Free Enterprise (CFE)

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Original title: [시장경제 길라잡이] 평등주의 정책의 함정

Author: Sung-no Choi

Date: 2019-05-06

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=column&pn=14&idx=20161