_Distributive Justice in a Pure Service Economy_


                  by Bryan Caplan


1. The Pure Service Economy

Imagine a society in which _goods_ are superabundant, but in which
_services_ remain scarce.  That is, property narrowly conceived
is virtually there for the taking, but the _labor services_ of other
people most decidedly are not.  Now such a situation would hardly be a
utopia: for some of the things most essential to life -- surgery for
example -- would still be scarce.  

It follows that the only thing that would cost 
something would be labor itself; and of course it
could only be purchased with a corollary offer of labor.  To keep the
example simple, let us add the stipulation that there is no money, nor
even labor notes; rather, when someone gives a service to one person, he
simply records the deal in a book.  If someone reneges on an agreement,
no punishment is inflicted, but word gets around and the reneger finds
that no one wishes to trade with him or her any further.

2. Testing Theories of Distributive Justice

Now this hypothetical society offers an interesting test for some
competing theories of distributive justice.  For if you examine the
hypothetical carefully, you will see that there is no possibility of
re-distribution in such a system save by direct imposition of forced
labor.  Since most theories of distributive justice require
such redistribution, this hypothetical service economy presents
the advocates of such theories with two stark alternatives.  
Their first alternative is to abandon their redistributionist
theory of justice; their second is to openly embrace forced labor
as a means of achieving a just society.  Indeed, the latter 
alternative would commit them to the view that not only is forced
labor permissible, but it is indeed mandated by justice.

To make this clearer, consider the case of a trained surgeon
in such an economy.  He spent many years in study to acquire his
skills; but of course his raw talent and intelligence played
a big part too.  Now this surgeon finds that his labor is extremely
valuable; he has the power to save lives.  People will pay an
enormous amount for the value of his services.  Of course, they
are paying him back in other services: 1000 hours of maid service
in exchange for 1 hour of surgery; 200 haircuts for a removed
appendix;  20 college educations for a triple bypass.

It is not difficult to see that this surgeon is going to be
extremely rich because of his special talent.  The disparity
in income between himself and other people will be very great.
Indeed, some people may be too poor to afford his services at
all.  And the question will naturally arise: Does justice permit,
or even require, that the surgeon be forced to provide free
services for others, or give some of his payment back to the community?
Either choice commits us to forced labor: either the doctor
must be forced to toil, or else his patients must be forced to
give some free labor services up as a "tax" every time they
pay him.

But suppose that we recoil from this notion of forced labor.
Where are we then?  Quite simply, we are left with a libertarian,
free-market economy, in which people own their own bodies and
can acquire the services of others solely by contractual agreement.
Charity can of course exist; the surgeon might help the poor
out of sympathy for their plight.  But nothing in the system
assures that the poor will be provided for; that becomes a 
matter of generosity rather than of right.

3. Redistributionist Charges of Injustice in the Pure Service Economy

We can easily imagine the criticisms that might be made about
the justice of accepting the libertarian theory of distributive
justice in our hypothetical society.  First, the poor and
unlucky have no guarantees in such a society.  The better-off
members may choose to help them; or they may not.  The care
of the poor becomes a matter of purely private concern, and
the choice to give becomes fully voluntary (and hence uncertain).
Secondly, such a society would permit unlimited inequality.
The surgeon might need to work only one day per year, enjoying
luxury and comfort every other day.  Thirdly, success in such
a society would be strongly influenced by "luck" or unearned
good fortune.  The surgeon might have to work hard to learn his
trade, but surely hard work isn't the whole story.  He also
probably had greater innate intelligence; perhaps a better
family environment than others.  Indeed, the well-off member
of this society might be a talentless heavy-metal musician,
whose singing can command large exchanges of labor services
from others.  The musician's good fortune in this case may be
exclusively a matter of luck, without a day's sweat and toil
to train for his career.

To these three criticisms we might add others.  If the surgeon
is the only person of his trade, then he may exercise "monopoly
power."  Or returning to the case of the talentless musician,
we will notice that production of services in this society is
fully determined by willingness to pay, with no reference to the
true value of the goods produced.

The interesting thing here is, of course, that these are _precisely_
the same criticisms normally made of the standard libertarian,
free-market society in which both goods and services are scarce.
In other words, there is no relationship between the need for
redistribution and the existence of private property narrowly
defined.  Whatever complaints may be launched against 
libertarianism in the real world may also be made against the 
application of libertarianism to the pure service economy as
outlined herein.

And yet it is _very_ difficult to abandon the intuition that
the surgeon cannot morally be forced to give free services to
the needy, or even to reduce his prices to the slightest degree.
What we are faced with is the need to openly deny that the
surgeon owns his own body, and may do with it as he sees fit;
and that his services must be obtained exclusively by voluntary
means.  In short, if the surgeon says No, then to force him
to work is slavery, no matter what the need of the poor, the
degree of inequality, or the role of pure luck in the surgeon's
success.  Of course, this may simply lead one to affirm the
justice of slavery, but that is hardly a plausible escape route.

4. Extending the Model

Now suppose that instead of writing down labor debts in a book,
people started circulating negotiable labor notes.  (As was
apparently done in Josiah Warren's 19th-century utopian village).
Would the redistributionist have a firmer case here?  It is
hard to see why he would.  For these notes are merely a more
convenient way of designating the same agreements as before;
for naturally in the initial setup, the surgeon could agree to
perform surgery on Fred on the condition that Fred gives 100
hours of wood-working lessons to Ann (and Ann agrees to give
2 years of flute tutoring to the surgeon).  So why should the 
more fluid designation of the underlying fundamentals 
matter?  True, it may now be more _convenient_ for a government
to demand 10% of all notes exchanged; but what we are interested
in here is not convenience but justice.  The fact remains that
the 10% tax is blatantly a demand for forced labor; for each
time one person sells labor to another, he is also compelled to
give up an additional 10% of that labor against his will.

But let us then go further.  Suppose that the abundance of nature
dried up, and goods, from land to minerals to wildlife, became
as scarce as they are in the real world.  Naturally, people
would want to claim products as their own; they would want to
homestead unowned products and claim exclusive ownership of them.
What objection could be made to this new regime; and would it
create a wedge for redistributionist theories of justice to
come into their own?

Again, it is hard to see how it would.  The right to claim
unowned products by "mixing one's labor with them" is not
deducible from the claim of self-ownership, but the ideas are
nevertheless closely connected.  And so are the objections
that might be levelled against one or the other.

One might claim, for example, that because the homesteader does
not "really create" the cultivated land, he is not entitled to
it.  But of course the homesteader did not create himself either;
does it then follow that he is not entitled to own himself?
Or one might claim that the labor merely _adds values_, and so
the homesteader is merely entitled to own the value that he adds;
and the remainder may be legitimately taxed away for social aims.
But as our example with the surgeon makes clear, the same could
be said about my own labor services.  Namely, while I do contribute
to my own value by training and experience and education, a
significant fraction of the market value of my services is
determined by my innate intelligence, dexterity, and so on.
Does my education entitle me merely to that part of my earnings
added by the education?  May I be forced to labor a percentage
of the time equal to the percentage of my labor value determined
by my raw talent?  One of the many absurdities entailed thereby
is that the totally unskilled laborer is entitled to _nothing_.
Again, then, we see that generalizing the argument against
individual homesteading leads us to the untenable affirmation
of the propriety of forced labor.

5. Conclusion: Libertarianism and Its Alternatives

No moral argument, indeed no argument at all, can compel agreement.
It always remains open to a person to deny the premise OR embrace
the conclusion.  The one thing he cannot do is accept the premise
and deny the conclusion.  The most desirable feature of an argument,
then, is that the initial premise have greater initial probability
than the conclusion does.

Now I claim that the argument arising from this thought experiment
does indeed meet this criterion.  The truth of libertarianism as
a theory of distributive justice does indeed strike most people
as wildly unlikely; for it is a theory bereft of concern for
equality, poverty, luck, and so on.  (Or to be more precise:
it is a theory that says that these concerns are not a matter of
justice and right; it leaves open the possibility that they are
of moral interest, but on a lower level).  And yet, if anything
is known about morality, it is known that it is just plain
wrong to force someone to labor against his will, to enslave
him or her.  Wrong whatever else must happen in consequence.
This intuition is perhaps the fundamental intuition behind
libertarian moral theory; and it is the intuition that the
proponents of redistributionist theories must reject if they
are to avoid the libertarian position.