I am fairly libertarian-leaning, but I have qualms about going full libertarian.
Prices are really great. Prices are a really great thing about markets. For instance, consider flow restrictors (example chosen for being extremely unimportant and having a delightfully pissed off article written about them). Most showers in the US have flow restrictors, which means that their showers use less water, but also are less enjoyable, at least to some people.
Prices are a much better way to solve this problem than requiring flow restrictors is. If the price of water reflects the costs of water– either due to the Magical Free Hand of the Market, or because the government has put a tax on it equivalent to the externalities of using too much water– then that guy who wrote that delightfully pissed off article can have as unrestricted a shower as he pleases. If he pays for it, that is prima facie evidence that the shower is more valuable to him than the cost of the water. On the other hand, if you’d rather spend your money on hookers and blow, you can install your own flow restrictor, or take a shorter shower, or some other method of conserving water. Since people have different preferences, this lets everyone satisfy their own preferences.
At least, as long as everyone has the same amount of money. If we both make $20,000 a year, the fact that I take that shower and you don’t is a pretty good sign that I care more about the shower and you care more about hookers and blow. If I make $20,000 a year and you make $200,000, it might just mean that you can’t be arsed to install a flow restrictor to save an amount of money that is comparatively meaningless to you.
Of course, you don’t actually want to require that everyone make the same amount of money. Some jobs are more desirable than other jobs. If your job is soul-crushingly mind-numbingly boring and my job is taste-testing ice cream, then it makes sense that you earn more money. We can model that as you and I working the same job, except that I paid a $180,000 Getting To Eat Ice Cream For A Living fee.
(Totally worth it.)
The same thing goes for jobs with longer hours vs. shorter hours, jobs working with nice people vs. jobs working with complete assholes, jobs that help people vs. tobacco company executive, etc. If your job has good traits other than money, then– all things equal– one should expect you to make less money at it.
But all things are not equal. In fact, you can observe that the jobs that make the least money are often the worst in terms of working conditions. Fast-food employee, retail clerk, guy who holds up a sign telling you that there’s a “sale!!!!!!” at the jewelry store– these jobs are ill-paid and also terrible.
The reason is that people have different abilities. Through no fault of their own, some people are smart, hard-working, and charismatic; other people are dumb, lazy, and in possession of voices so soporific that Pfizer is considering marketing them as a sleep aid. Some people have parents who are willing and able to pay for them to get training or the $100,000 conscientiousness and intelligence certificate; other people don’t. Some people have friends who can tell them about well-paying jobs and vouch for their good qualities; other people have friends who can tell them about the fact that the McDonalds down the street is hiring; still other people don’t have friends at all. Some people inherit billions; other people grew up on the street. None of these have anything to do with your desires: if you’re in the fifth percentile in conscientiousness, you probably really want to be more hard-working, but as it happens you were born with a lazy brain and you’re probably not going to become as rich as an effortless workaholic.
The most striking case of this is disabled people. Many disabled people– including myself– are incapable of working a job that will support ourselves. Many others require significant and potentially expensive accommodations to work a job.
What this means is that the market will tend to oversupply the preferences of some people (those that have skills and abilities that mean they have a lot of money) and undersupply the preferences of other people (those that don’t). From many moral perspectives (including utilitarianism, contractualism, and veil-of-ignorance Rawlsianism) this is unsatisfactory. It is unfair that society cares less about someone’s preferences just because they were born stupider than other people.
Of course, it’s often hard to distinguish impairments and preferences. It is hard for a government or society to tell apart “I am low conscientiousness but would prefer to be able to do more work than I am capable of” from “I don’t like working that much and am gladly taking a lower salary so I don’t have to.” (Hell, it’s hard for an individual to tell those two apart.) We want to care about group #1’s preferences as much as we care about everyone else’s. But we also want The Magic of Prices to allow group #2 to make an informed decision about how much they should work.
I think the least distortionary way of dealing with this problem is by transferring sufficient cash to poor people that they can maintain a reasonable standard of living, gradually phasing it out as people earn more money, such that people will always earn more money the more they work. That isn’t perfect. Some unimpaired people will not pay the full social cost of their desire to work less. And it isn’t treating impaired people completely equally; they still won’t have the option to work $200,000/year jobs. But I think that that is the least imperfect tradeoff. It makes sure that impaired people can fulfill their most important needs, while minimizing the distortion to prices.
I also think it makes sense to transfer cash to disabled people, with more money to more severely disabled people. Most disabled people are impaired, not people with unusual preferences. Of course, any attempt to give something to disabled people and only disabled people creates gatekeeping problems: wherever you draw the line, some disabled people will not be able to take advantage of it and some people who probably aren’t that impaired will be able to. But the other option is undervaluing the preferences of all disabled people, which I think is worse.