Thursday, December 13, 2007

Greg Mankiw contrasts left vs. right economic perspectives


My view is that good policy is all about maximizing freedom and opportunity, while minimizing poverty and suffering. And I agree with Mankiw, a lot of the differences of opinion can be captured in his question:
Is the market-based distribution of income fair or unfair, and if unfair, what should the government do about it?
I'm a big fan of negative taxes (for food, housing, and health insurance; requires means testing) and vouchers (for education; does not require means testing). I believe that negative taxes are better suited for homogeneous needs, and vouchers for more individualized preferences.

But I'm willing to put any support program into either negative taxes or vouchers. Why? Because it still increases freedom and opportunity for individuals and their families over what we have today. Not just that, but institutions--whether profit or not-for-profit--will naturally be more responsive and accountable to those individuals and families than what we have today.

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