Philosophical Issues in Economics

Comparison of the two thoughts

Friedman and Tawney both believe that equality and freedom should be the essential fundamentals of the society. But they differ in their perception of the concepts.

For Friedman equality of opportunity fits in with freedom, while equality of outcome and the concentration of powers in the hands of the government clashes with it
But this position is criticized by Berlin:

“The fate of personal liberty during the reign of unfettered economic individualism-about the condition of the injured majority…a situation in which the enjoyment by the poor and the weak of legal rights…. Became an odious mockery.⁴⁷

Tawney on the other hand also believes that equality of opportunity is imperative to freedom, but he concentrates more on the redistribution of income, which will increase the freedom of the poor but decrease the freedom of the rich. He feels that unbridled economic liberty provides ‘equal opportunities of becoming unequal’. They both view the equality of opportunity differently. To Friedman equality of opportunity entails removing of arbitrary obstacles, but he does not mention arbitrary advantages like inheritance, or the lack or a certain basic required level of income, whereas to Tawney a certain level of income is imperative to even start a debate for freedom. Both agree that there should not be arbitrary obstacles, but both don’t agree over their contents. Tawney argues that economic obstacles (e.g. Poverty) are as much major obstacles to freedom as Friedman’s arbitrary obstacles
And in Friedman’s scenario all are free to go to dine at the Ritz but can most afford to? All are entitled to a lawyer, in practice can they afford to? Friedman assumes that in the free market all start from the same platform, and then the free market enhances their opportunities, but they don’t. There is a laborer and an entrepreneur, both at different levels; the free market will reward them disproportionately. The inequality will increase. As Will Durant comments: leave men free, and their natural inequalities will multiply almost geometrically. To check the growth of inequality, liberty must be sacrificed. Rawls also puts liberty first only after a certain minimum amount of liberties and well-being is secured for all.
Their contrasting positions can be summed up in this line; Tawney feels that not every body can avail the opportunity of going to the Ritz, while Friedman says that if there were no free market there would be no Ritz.

Conclusion

Neither of the authors gives perfect explanations. Both only discuss some aspects of freedom, tending to underestimate the possible conflicts between them. Yet its determinants are multiple and varied. As Berlin comments: ‘to speak of freedom, as an end is much too general. It is more complex and painful. One freedom may abort another; one freedom may obstruct or fail to create conditions, which make other freedoms, …or freedom for others possible. Positive and negative freedom may collide….’⁴⁸

This suggests that it is hard to lay down requirements, since free is so vague and elusive.
Still considering a relatively free society, perhaps it does not emerge that the solution is any extreme offered by the two writers. If you push too far for equality, you lose out on some freedom; if you push too far for freedom you lose out on the freedom of the poor. Although I would tend to concur with Frankfurt’s (1987) doctrine of sufficiency, “What is important from the moral point of view is not that everyone should have the same but that each should have enough. If everyone had enough, it would be of no moral consequence whether some had more than others. (Still, enough must allow as Tawney argues for genuine equality of opportunity)⁴⁹. And I would agree with Berlin who suggests that ‘if a man is too poor or too ignorant or too feeble to make use of his legal rights, the liberty that these rights confer on him is nothing to him’⁵⁰. Yet Friedman is right to stress that freedom at the minimum should be absence of tyranny and domination. This could bring forth a middle course, which could be a welfare state, which could offer a safety net complimented by the free market system.

Bibliography

Berlin, I (1995). ‘Liberty’.

Freidman, M and R (1980) Free to choose.

Hayek, F. (1960). The constitution of liberty.

Mill, J.S (1859). On liberty.

Norman.R, (1987). Free and Equal.

Rawls, J, (1993). Political liberalism.

Rothbard, M ‘The ethics of Liberty’.

Peter McCullen & Colin Harris ‘Generative Equality, work and the Third Way: a managerial perspective’

Tawney, R.H (1964). Equality.

The Stanford Encyclopedia of Philosophy, ‘Equality’

IV. Poverty
The assertion…that poverty is a value judgment…suffers from difficulties’ (Sen). Consider possible links between the following statements and outline arguments that could be presented for each:

1. 
   judgments of poverty are theory-laden;
   
2. 
   judgments of poverty are value-laden;
   
3. 
   judgments of poverty can be judgments of fact.
   

Using your analysis, discuss the assertion that poverty is a value judgment.


Essay 1
(by Mariah Manvelt Beck)

It is debatable to what extent judgements can be regarded as theory-laden, value-laden or factual. This essay indicates that one of the main reasons for this debate is because many authors have not clearly defined their interpretation of theory, value or fact and have assumed definitions without discussing the implications of their specific use or how these concepts interact. This essay addresses several of these issues before examining to what extent theory, value and fact play a role in poverty judgements.