Some people, such as our Jacob Drucker, criticize big deficits as “irresponsible.” Others criticize the critics for falling into “The Fairness Trap”: blinded by their attempts at being moral, they fail to see we need to spend a lot of money now in order to stimulate the economy and promote long-term growth. This might seem to be a case of moralism clashing with pragmatism, an unstoppable force colliding with an immovable object—and what can you do then but make an arbitrary choice?
That’s not our plight. This cannot be a clash of morals against economics because both sides must make use of morals and economics. For the defenders of austerity, there is something especially awful about a debt that is 200 percent of GDP; it is awful in a way that a debt 20 percent or 2 percent of GDP is not. Presumably that has something to do with the economic ramifications of such a debt—the future opportunities that will be foreclosed by it, for example. And the proponents of stimulus spending, despite appearances, take a normative position. They say that we should do something: spend. Therefore, each of them presupposes some normative framework. So thinking about the right normative framework to use will get us a long way towards figuring out the right policy. Which framework is the best?
Let’s think about a few options. We can start with one which a lot of people find very attractive: Do the most good, and measure the good in the total wealth of all present and future persons. There’s a big problem with this view. Derek Parfit calls it “The Repugnant Conclusion”: For any possible population with a high quality of life, there exists a much larger possible population whose members’ lives are barely worth living but which is better than the first.
(The area of Box Z—the total good—is greater than that of Box A.)
This is problematic because when you mix the Repugnant Conclusion with the injunction to do the most good, you get a Dismal Conclusion: We ought to bring into existence some mass of people whose lives are miserable. To see how dismal and how ridiculous this conclusion really is, apply our framework back to the issue of deficit spending. It implies that we ought to incur massive debt to encourage the most possible procreation. Trillions upon trillions to construct a national web of procreation centers, in which babies are mass-produced so that they can be born into lives of starvation and debt-bound servitude.
A slight reformulation, a very popular one, of the morality of Do the Most Good is vulnerable to the flipside of that example. That framework suggests that we should maximize not total wealth, but average wealth. Perhaps then we ought to spend a lot of money preventing the births of many people, people born into poor natural or social fortune, who would drag down our national average wealth.
When I explained this to HPR Online Editor Paul Schied, he was skeptical that these examples should destroy the Do the Most Good moral framework. He thought the framework could be saved by striking the right balance between total and average good per person, the one that can avoid all the outrageous conterexamples. Maybe. But that balance, if we could ever find it, would probably be vanishingly complex, and it would likely include terms which do not directly refer to wealth and other things which are good. It would probably refer more directly to what makes actions wrong.
To think about austerity and stimuli, I suggest we start more directly there, with wrongdoing. A good account of wrongdoing is that of T.M. Scanlon. He sees figuring out moral questions as figuring out “what we owe to each other,” figuring out the principles which ought to form the basic structure of relationships between persons. As he more precisely puts it: “an act is wrong if its performance under the circumstances would be disallowed by any set of principles for the general regulation of behavior that no one could reasonably reject as a basis for informed, unforced, general agreement.” That’s not a snappy formula. It takes some time and thought to see its demands. What are they, with respect to deficit spending? That is the $1.3 trillion question. I’ll take a crack at it next week.