Recently The New Republic reviewed a book that had the thesis that "conservatism is always and everywhere a resentful attack on those who seek to make the world more fair." The reviewer quotes the book as saying, “Conservatism has been a forward movement of restless and relentless change, partial to risk taking and ideological adventurism, militant in posture and populist in its bearings, friendly to upstarts and insurgents, outsiders and newcomers alike.” Despite this, "all conservatives are reactionary."
The reviewer ultimately dismisses the thesis of the book and its claim that there are no real differences between the social conservatives and the libertarians, the Randians and the evangelicals. I suspect that the book tells us much less about conservatives than about the author. Conservatives simply do not worry about income and wealth inequality in the same way that the Left does. There are at least three reasons for this. First, income inequality, which is the focus of the left, is only one dimension of inequality and rarely the most important. Some people are healthy some are not, some people have loving parents and some people have abusive parents, some people have exceptional athletic, artistic, or intellectual ability and others have little ability. Even if it were possible to totally eliminate income inequality, the other forms of inequality would remain and they are more important than income inequality. Second, inequality seems more important if you view the world statically. The right tends imagine the world as dynamic and does not worry about inequality if there is mobility. They worry about immobility more than inequality. Finally, those on the right suspect that attempts to reduce inequality derived from market outcomes tends to increase inequality derived from the political process, and they fear that form of inequality more because it comes with coercion that is missing from market-derived inequality. The gap between Bill Gates and the average citizen is much less than the gap between President Obama and the ordinary citizen.
Rather than seeing the differences between left and right as founded on differences in how each side views inequality, an alternative and in my view a far more insightful way is to consider how they view the marginal costs and benefits of more government. Aristotle argued that virtue was in the middle--either too much or too little of something could be bad. Economists get to the same idea with the concept of diminishing returns. The cost of most things not only rises as we get more of it, but the rate of rise increases. Though the benefit of most things rises as we get more, the rate of rise decreases. Without this idea economists would have a hard time discussing profit-maximizing for business or utility-maximizing for a consumers.
The figure below applies this idea to government. Not everyone would agree that this diagram is appropriate. An anarchist, for example, would have the cost of even a little government as greater than the benefit of even a little--there would be no intersection of the lines. But the vast majority of people would find this diagram captures at least a simplistic view of the matter.
People who believe that the amount of government is too small usually argue that much private spending is pointless or wasteful, while there are important collective goods that are not being produced. It was this argument in several books that made John Kenneth Galbraith famous. For people with his position, the country is currently to the left of the intersection. On the graph the labels for socialists and liberals are placed to indicate where these groups believe the county to be. They believe an expansion of government brings more benefit than it adds to costs.
Libertarians and most other conservatives believe that the country is to the right of the intersection. Even if some amount of government is essential in a modern economy, more government may not be better. If the size of the government were cut, there would be a reduction of benefits from government activity. However, if the funds needed for this government activity were left in the private sector, they would be used for more important things than they are used for by the government.
Some on the right go even further, however, They argue that the government has become so big that additional government activity does not have small benefit but it is harmful. Some of those who identify as supporters of the Tea Party movement seem to believe this, and their label indicates where they think the country is.
This approach is a simplification because the government does many things, and both those on the left and right may argue that in some areas the government does too much while in other areas it does too little. Nonetheless, it captures an essential difference between conservatives and liberals. Conservatives have more trust in market processes than in political processes and worry that the scope of government is too large. Liberals have more faith in political processes than in market processes and worry that the scope of the market is too large.
Nobel Symposium on Money and Banking Day 2
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