Justice or Utility; R. J. Bidinotto

T he core purposes of government are well expressed in the Preamble to our Constitution: to "establish justice" and to "insure domestic tranquility." But there's a hierarchy of importance here. By seeking justice, you will necessar ily promote domestic tranquility. However, if you seek domestic tranquility alone you won't necessarily promote justice. How, then, to address crime? Liberals emphasize prevention and rehabilitation. Conservatives, and many free marketers, emphasize deterrence and incapacitation (jail). But all share a utilitarian objective: to advance future public safety by at tering the future behavior of the criminal. The problem is that utilitarian objectives can be sought without concern for justice. For decades, liberals have run our legal system. Renouncing punishment as a proper response to an offender's past crimes, their prevention-and-rehabilitation approach has tried instead to alter his future conduct, for the eventual betterment of society as a whole.

This anti-punitive strategy has obliterated personal responsibility. The felon endures few negative consequences for the damage he does to others. This has led to dual out rages: the unjust neglect of victims, and excessive leniency toward their victimizers. Mr. Bidinotto is a longtime contributor to Read er's Digest and The Freeman, and a lecturer at FEE seminars. Criminal Justice? The Legal Sys tem Versus Individual Responsibility, edited by Mr. Bidinotto and published by FEE, is available at $29.95 in cloth and $19.95 in paperback. But under utilitarianism, leniency is not the only option. If public safety is the sole objective, why not try to suppress crime rates by executing-or jailing forever every criminal we catch, from jaywalkers to serial killers? Instead of inordinate le niency, why not try unbridled punitivity? Many conservatives and free marketers prefer this alternative. Their deterrence and-incapacitation approach represents the flip side of the same utilitarian coin. It, too, aims solely to alter an offender's future conduct, for the eventual betterment of society as a whole. It, too, severs any clear causal connection between the degree of injury suffered by the innocent, and the degree of punishment imposed on the per petrator.

Utilitarianism thus has led both the Left and Right to injustice: to disproportionate punishment in relation to the transgression. After all, once illegal acts are decoupled from a proportionate legal response, the only remaining argument is whether that response should be anemic or draconian. Utilitarianism also leads both sides to collectivism. What counts to utilitarians, Left or Right, is not justice for individuals, but only lower crime rates for society in general. No longer gauged by the harm inflicted upon individual victims, punish ments are instead based on arbitrary pre dictions of the criminal's future dangerous ness to "society." In utilitarian social calculations, there is no place for the an guished human face of an individual crime 508 The Foundation for Economic Education Irvington-on-Hudson,New York 10533 Tel. (914) 591-7230 Fax (914) 591-8910 August 1995 Protectionism, Old and New P rotectionism, which is the policy of protecting home industries from for eign competition, has many origins.

Some date back to the ways of tribal soci eties which generally viewed foreigners as aliens and enemies. Others are singularly American, arising from economic stagna tion and dollar decline. All are the result of misinformation which is more harmful than non-information. Error is always more active than ignorance. Every form of protectionism builds on raw political force. It takes an army of tax collectors, administrators, and border guards to protect domestic industries by levying import tariffs and other restrictions on foreign products, or by paying bounties on domestic products. Protectionism builds on the governmental power to tax one man to help the business of another. Taking money from one American and giv ing it to another is the source of much social and economic conflict. Protectionism receives its political strength from advocates of political power who welcome additions to governmental power. They are supported by mainstream economists who look to government offi cials for full employment and economic growth. Their primary concern is national income, national spending, and national employment. They favor national planning which obviously cannot tolerate interna tional free trade; it would upset, disrupt, and quickly undo any planning.

The staunchest allies of these politicos are labor unions to whom government protection is of crucial importance. They live by the doctrine that union members have an inherent right to a job in their particular industry, at their present location, and at rates of pay that exceed market rates. Plagued by the inability to compete and by high rates of unemployment, they argue forcefully against everything foreign. Unemployment undoubtedly is a great social evil that concerns us all. It is an eco nomic phenomenon of loss and waste that harms not only the jobless but also their fel low workers who are forced to support them. Alleviation of unemployment has become an important political task by which governments are judged and mea sured. But the problem also raises a basic question: can import restrictions increase the demand for labor and reduce unem ployment? Unfortunately, they cannot, because they reduce the productivity of labor and, therefore, reduce the demand for labor. Surely, a newly protected indus try gains temporarily from the reduction of competition: it can raise prices, earn higher profits, and pay higher wages. But other industries will consequently suffer from the loss of trade and the higher costs of labor. Consumers everywhere experience reduced purchasing power.

In many respects, trade barriers are simi lar to natural obstacles that thwart human effort and impair man's wellbeing. Both increase the demand for specific labor. For example, the destruction of housing by flood, earthquake, or fire increases the demand for housing supplies and construction labor, while also reducing the demand for a myriad of other goods which the destruction victims must now forgo. Similarly, import restrictions on foreign cars may boost the demand for domestic cars, but they also reduce the demand for other goods which the restriction victims, that is, consumers must forgo. Trade restrictions thus destroy more jobs than they can possibly create. Yet most American workers are convinced that they need such government protection. Without trade barriers, they believe, for eign products made by cheap foreign labor would flood American markets and force American workers to suffer substantial wage cuts or outright unemployment.

Americans can trade with each other because they have similar income and working conditions, but they cannot trade with foreigners who work for less at lower living standards. When carried to its logical conclusion, this wage-rate argument bars all foreign trade because no two countries are identi cal in labor productivity and income. It may even bar interstate commerce because wage rates differ from state to state. Wage rates in New York State are generally high er than those in Mississippi; by this argu ment, therefore, New Yorkers must not trade with Mississippians In actual fact, the cost of labor is merely one of many cost factors determining the competitiveness of a product. It is significant that the loudest agitation for protection is heard in those industries competing with high-cost foreign labor. The American automobile industry is com peting with Japanese and German carmak ers who pay considerably higher wages and fringe benefits. If the wage argument were correct, there would be few Japanese and German cars on American roads.

When the labor argument is not believ able, American protectionists quickly retreat to a sixteenth-century defense: the balance-of-payments doctrine. It contends that government should promote exports to bring money into the country and stifle imports. The modern version urges legisla tion and regulation to restrict the use of foreign goods and encourages exports for the purpose of creating jobs in the country. Both versions, the old and the new, are spurious and erroneous. The United States is currently experienc ing chronic balance-of-payment deficits with Japan. The ordinary Japanese trade surplus runs at about $10 billion a month, of which $5-$6 billion are with the United States. They consist of dollar earnings which the Bank of Japan then promptly invests in U.S. Treasury obligations. The Bank of Japan is the world's biggest financier of U.S. deficits, both in the federal budget as well as in current trade accounts, and is the strongest supporter of the U.S.

bond market. If it were not for this solid support by Japan, the world's biggest cred itor country, the financial conditions of the United States, the world's largest debtor, would be rather precarious. In many parts of the world the U.S. dol lar is greatly undervalued in terms of pur chasing power. The dollar buys 30 percent to 50 percent less in Japan and Germany than it does here in the United States. Yet in this age of instant communication and capital mobility, it is not purchasing-power parity that determines exchange rates but capital profitability and opportunity. U.S. balance-of-payment deficits are the result of excessive monetary ease on the part of U.S. monetary authorities, of low interest rates, of high taxes on capital and on sav ings, and of chronic deficit spending by the federal government. America is consum ing too much while saving and investing far too little. Protectionism makes for strange bedfel lows. It brings together big business and big labor, politicians counting votes and government officials yearning for power, sixteenth-century thinkers and twentieth-century economists. It unites many petitioners for political favors and largess in a common cause against consumers and foreigners. 2..__R'..../ - L~-'-'-7 Hans F. Sennholz DISASTER IN RED: The Failure and Collapse of Socialism Edited by Richard M. Ebeling T he dramatic disintegration of the Soviet Union in the late 1980s has overshadowed an event even more momentous: the collapse of socialism as a moral, political, and economic ideal.

For over a century, the world was seduced by the socialist siren song. Its adherents declared that the individual ought to be sacrificed for the good of society; that his rights were subordinate to the whims of the majority; and that central planning was more efficient than the "anarchy" of the unregulated marketplace. But everywhere socialist ideas were imple mented, the results were the same: poverty, misery, and bloodshed. Socialism, as this important new work argues, has been a Disaster in Red. In three dozen incisive essays drawn from the pages of The Freeman, an array of expert commentators brilliantly unmasks the theoretical flaws, and universal failures, of the socialist ideal. The contributors include such eminent economists as Ludwig von Mises, Hans Sennholz, and Henry Hazlitt, who contrast central planning and the market economy; Dean Lipton and Thomas DiLorenzo who describe the social destruction caused by collectivism; Clarence Carson on the tragedy of Soviet communism; Steven Mosher, James Bovard, Morgan Reynolds, and others, detailing socialism's global failures.

Here is the definitive dissection of a false ideal, and of the real-world horrors it has caused. But more than an autopsy of a dead theory, Disaster in Red is a warning to those who do not yet grasp that the horrors were inherent in the theory itself. DISASTER IN RED (ISBN 1-57246-003-2) 389 pages, comprehensive index, paperback, $24.95. introductory price until September 30, 1995: $19.95. Order from: The Foundation for Economic Education Visa or MasterCard orders: (800) 452-3518 Back to School Sale FEE Classic Public Education and Indoctrination The origins of public education and its destructive consequences. Faustino Ballve Essentials of Economics The best survey of principles and policies. Bettina Bien Greaves, editor Free Market Economics: A Basic Reader This anthology of selected readings is ideal for use in the classroom or as a personal course in free market economics. Henry Hazlitt The Foundations of Morality The author presents a consistent moral philosophy based on the principles required for voluntary social interaction.

The Failure of the "New Economics" A brilliant analysis of the Keynesian fallacies. Ludwig von Mises Economic Policy: Thoughts for Today and Tomorrow A good introduction for businessmen, consumers, and students. George C. Roche, III Education in America An enlightened discussion of the collapse of standards and the revolt on campuses. Thomas Sowell Inside American Education: The Decline/·The Deception, The Dogmas Sowell calls for a new orientation toward learning rather than multicultural diversity. FEE Library for Home Schoolers Twenty-five books from the 1995 FEE Book Catalogue. $307 when bought singly. Regular $14.95 9.95 14.95 18.95 14.95 8.95 12.95 24.95 225.00 Sale $11.95 7.95 12.95 15.95 12.95 7.95 9.95 19.95 195.00 Sale ends September 30, 1995 Postageand handling:Please add $3 per order of $25 or less; $4 per order of $26-$50; $5 per order of more than $50. Send your order, with accompanying check or money order, to FEE, 30 South Broadway, Irvington-on-Hudson, New York 10533. Visa and MasterCard telephone and fax orders are welcomed: (800) 452-3518; fax (914) 591-8910.

victim. He or she sinks into a sea offaceless, collective crime statistics. Don't misunderstand: prevention, reha bilitation, deterrence, and incapacitation are worthwhile ancillary objectives of the criminal law. But they aren't primary ob jectives. They address only general social conditions, so that anonymous citizens of tomorrow· may not turn to crime. None of them, though, need be grounded in the prin ciple of making punishments fit past crimes. None of them need be rooted in justice. The alternative? A legal system that aims primarily at exacting retribution. Retribution means administering punish ment to a criminal in proportion to how much he has hurt others. I use' 'retribution" to mean "reflection." The crook's basic aim is to gain by force something at the expense of someone else. His actions impose dam ages upon an innocent person. The funda mental goal of a strategy of moral retribu tion, then, is to reflect those damages back onto the criminal himself.

This policy is both moral and practical. Moral, because it upholds innocent human life, and the just social framework upon which individual survival and wellbeing depend. Practical, because a policy of re.flecting proportionate losses back upon the culprit frustrates and negates his desire, which is to profit at someone else's expense. Retribution means he won't getaway with it. A retributive system would incorporate many of the worthy crime-reduction ambi tions of the utilitarian. For example, long terms of confinement under harsh condi tions, with inmates forced to work and pay restitution to victims and taxpayers, would surely deter more criminals than does our current toothless system. Being locked up would also prevent. them from causing or dinary citizens more trouble, and-who knows?-possibly encourage the occasional inmate to rehabilitate himself. But since we cannot predict their future dangerousness, a retributive system would abandon such utilitarian fads as treatment programs and' 'selective incapacitation. " A term of confinement would be tied to the seriousness of a convict's offenses-period.

509 Because retribution entails punishment, it's often criticized as being motivated by a crude thirst for revenge. In fact, a retribu tive legal system is the antithesis of private revenge, and the basis for the rule of law. My dictionary says "revenge" is "the carrying out of a bitter desire to injure another for a wrong done to oneself or to those who seem a part of oneself." Of course, revenge-based punishment need not be just: the injured party may retaliate disproportionately to the harm done. By contrast, "retribution" is "just or deserved punishment, often without personal mo tives, for some evil done." If we're to have a just and peaceful society, the use of after-the-fact, retaliatory force cannot be left to the arbitrary whims of private victims, each employing subjective criteria of personal injury. Precisely to min imize and avoid vengeance, vindictiveness, and vendettas, and the disproportionate pun ishments to which they lead, ajustice system must be based upon retribution, not revenge.

Retribution constitutes the premise that the level of punishment must fit the severity of the crime. This does not mean we need to punish in kind: the law need not literally demand' 'an eye for an eye," sinking to the specific tactics of the wrongdoer. But it does mean that society should punish in propor tion: the law ought to recognize gradations of evil and injury, and respond accordingly. In short, retribution is the only premise fully consistent with justice and individual ism. With justice-because it implements proportionality in criminal sentencing, fit ting the punishment to the crime. With individualism-because it bases punish ments on actual harm done to individuals. Retribution does not look to society's fu ture: it remembers the individual victim. Our nation's Founders made it clear that they saw no clash between the moral end ofjustice, and the practical ends of insuring domestic tranquility. A valid conception of retribution, of "just deserts," can incorpo rate many of the worthy purposes advanced by utilitarians. But it can also provide those purposes the crucial moral grounding they have never had. D THEFREEMAN IDEASON LlBERlY Justice and Cultural Diversity by Philip Perlmutter D iversity and multiculturalism are in creasingly heralded as desirable goals for society. It is argued that government should translate them into everyday reali ties-and in proportion to a group's percent age of either the local or national population, whichever is higher. For example, if a group such as women, blacks, Hispanics, Asians, American Indians, or gays are "x" percent of the national population, then that's the percentage of jobs they should have.