My letter appearing in today’s Financial Times:
Sir, Although I endorse Sir Samuel Brittan’s call to distinguish between Santa Claus and government “handouts”, his analysis is seriously flawed (“There is no such thing as the state”, December 17 [$link]). Sir Samuel’s description of the state, specifically “a mechanism for transferring claims to income or property from one citizen to another” is as salient as it is mischaracterised.
Uniquely empowered to exact property from individuals by virtue of its monopoly over defence, justice and coercion within a geographical area, government is a vehicle by which individuals in the state’s remit can seize resources from one another. This coerced appropriation, however subtly packaged in democratic phraseology, is nonetheless theft.
As for a systematic definition and defence of private property, Sir Samuel is advised to consult not neo-liberal doctrine but the Austrian School of economic thought. Murray Rothbard and others have established a straightforward and comprehensive case for property rights that refutes every statist and socialist critique.
The distinction between free markets and government redistribution is stark. In the former both parties to an exchange of goods and services are better off, as opposed to government intervention where property is seized from one and handed to another through a Byzantine administrative process that is unconnected to voluntary agreement. Verily, the law of the jungle exists not in competitive markets, where buyer and seller profit, but in the confiscatory public sector.
Concerning a minimum standard of living, the free market furnishes a solution. Insurance guards against unforeseen catastrophe; charity possesses the same compassionate qualities as state welfare, albeit without government confiscation and redistribution of wealth and the cultivation of a corrupting sense of entitlement in the recipient.
No man is a priori entitled to live at the expense of another; but through voluntary grace can a man assist another.
Grant M. Nülle, Research Fellow, Ludwig von Mises Institute, Auburn, AL 36832, US